Scoop has an Ethical Paywall
Work smarter with a Pro licence Learn More

Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 

MARKET CLOSE: NZ shares drop 1% on global selloff

MARKET CLOSE: NZ shares drop 1% on global selloff, led by Synlait, Sky TV; CBL meeting delayed

By Sophie Boot

March 23 (BusinessDesk) - New Zealand's NZX 50 Index dropped nearly 1 percent on global trade news, with Synlait Milk and Sky Network Television suffering while CBL remained in a trading halt as its administrators gained more time to consider its finances.

The NZX 50 fell 85.45 points, or 0.99 percent, to 8,515.36. Within the index, 39 stocks were down, seven were unchanged and four rose. Turnover was $106 million.

Global equity markets have fallen on concerns a trade war may emerge after US President Donald Trump announced tariffs on Chinese goods and China retaliated, announcing plans for reciprocal tariffs on 128 US products. At 5:20pm, Japan's Nikkei 400 was down 3.3 percent, the S&P/ASX 200 had dropped 2 percent and the Hang Seng was 2.8 percent lower.

"Our market has behaved quite nicely all things considered, and that's the nature of our exchange, which tends to have a lot of defensive, utility-based stocks which tend to outperform when things get a bit rough," said Peter McIntyre, investment adviser at Craigs Investment Partners. "Compared to our friends in Asia we are performing very well. Trump certainly has set the market alight again - even though there is a 60-day treaty before any of this potentially gets enacted, it has put the market on edge."

Synlait was the worst performer, falling 4.5 percent to $8.70. That still leaves the stock up 6.6 percent this week, after it surged on the release of its record first-half results on Wednesday.

Advertisement - scroll to continue reading

Are you getting our free newsletter?

Subscribe to Scoop’s 'The Catch Up' our free weekly newsletter sent to your inbox every Monday with stories from across our network.

Sky TV dropped 3.3 percent to $2.32, Westpac Banking Corp fell 2.7 percent to $30.85, and A2 Milk Co declined 2.6 percent to $13.73.

CBL remained in a trading halt at $3.17. The company's voluntary administrators have postponed the creditors' watershed meeting to gather more information and hired Goldman Sachs as an adviser. Auckland-based CBL appointed KordaMentha voluntary administrators on March 2 after the Reserve Bank sought an interim liquidation of its New Zealand supervised arm and the Central Bank of Ireland made a similar move against the insurer's European division.

The second meeting of creditors gives them the choice to resolve that a deed of company arrangement be executed, resolve that the administration should end, or appoint liquidators. It must be held by May 18, and KordaMentha must release a watershed report to creditors and the market by May 11.

"It just creates more uncertainty for shareholders," McIntyre said. "Obviously they'll be looking at all ways to obtain value for those shareholders and potentially a trade sale somewhere along the line. it's been a drawn-out saga and hasn't been a good example for the stock exchange either."

NZX was the best performer, up 0.9 percent today.

Meridian Energy rose 0.9 percent to $2.945, Port of Tauranga gained 0.2 percent to $5 and Genesis Energy was unchanged at $2.395.

"Meridian, Genesis and Ports of Tauranga are carrying dividends, so they're being supported in today's market," McIntyre said. "Income is an important part of investor returns, so a lot of investors are looking to continue to buy those stocks for the dividends."

Auckland International Airport gained 0.3 percent to $6.20. It released its February monthly traffic update showing domestic passenger numbers lifted 7.5 percent and international passengers rose 6.7 percent.

"International passengers and domestic passengers continued to be strong, the concerning thing is with regards to Australia which puts a dampener on the update," McIntyre said. "That weighed on the stock earlier today. It's been weaker this month, it is a quality company that has come off its highs quite considerably."

(BusinessDesk)

© Scoop Media

Advertisement - scroll to continue reading
 
 
 
Business Headlines | Sci-Tech Headlines

 
GenPro: General Practices Begin Issuing Clause 14 Notices

GenPro has been copied into a rising number of Clause 14 notices issued since the NZNO lodged its Primary Practice Pay Equity Claim against General Practice employers in December 2023.More

SPADA: Screen Industry Unites For Streaming Platform Regulation & Intellectual Property Protections

In an unprecedented international collaboration, representatives of screen producing organisations from around the world have released a joint statement.More

 
 
 
 
 
 
 
 
 
 
 
 

Join Our Free Newsletter

Subscribe to Scoop’s 'The Catch Up' our free weekly newsletter sent to your inbox every Monday with stories from across our network.