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

 

MARKET CLOSE: NZ shares edge lower

MARKET CLOSE: NZ shares edge lower as investors await earnings season

By Paul McBeth

Aug. 9 (BusinessDesk) - New Zealand shares edged lower as investors prepare for earnings season to kick into life, with the outlook for dividends a key feature after the Reserve Bank's surprisingly steep rate cut this week.

The S&P/NZX 50 Index decreased by 1.09 points, or 0.01 percent, to 10,873.21. Within the index, 24 stocks fell, 20 rose, and six were unchanged. Turnover was $114.2 million, with just five companies trading on volumes of more than a million shares.

The benchmark index went through a volatile week as a sell-off on trade tensions between the US and China spooked global markets, only to be reversed on Wednesday when the Reserve bank unexpectedly cut the official cash rate 50 basis points to a record low 1 percent. New Zealand's relatively high dividend yield has made it an attractive investment destination, and a weaker currency only added to the lustre by making local stocks cheaper for foreign buyers.

"The rate cut has reinforced the focus back on yield. As long as companies don't make any murmurings about adjusting their payouts, things will be pretty good," said Greg Smith, head of research at Fat Prophets.

Contact Energy kicks off the reporting season proper when it announces its annual result on Monday. It rose 2.1 percent to $8.30 on a volume of 1.4 million shares, more than its 90-day average of 1 million. The stock is trading at a dividend yield of 4.4 percent, and Smith said investors will be watching capital spending intentions. Meridian Energy, which is trading at a yield of 3 percent, rose 2.5 percent to $5 on a volume of 1.3 million.

The demand for yield wasn't universal, with the likes of Port of Tauranga down 2.1 percent at $6.02, Genesis Energy falling 1.7 percent to $3.45, Vector declining 1.6 percent to $3.80, and Argosy Property decreasing 1 percent to $1.46.

Vital Healthcare Property Trust was one of the early companies to report this week, posting a decline in annual profit due largely to higher management fees and increased finance costs. It fell 0.4 percent to $9.60 today.

Sky Network Television led the market lower, down 3.2 percent at $1.21 on a volume of 338,000, almost half its 611,000 average. A2 Milk declined 1.1 percent to $15.95 on a volume of 1.1 million shares, more than its 719,000 average.

SkyCity Entertainment Group fell 1.3 percent to $3.91 after launching its online casino as it attempts to compete with overseas rivals. It also settled the sale of the long-term concession on its Auckland car parks for $220 million.

Smith said SkyCity's online foray may be an attempt to ratchet up pressure on the Department of Internal Affairs, which is considering whether to introduce a licensing regime for overseas and domestic online gambling operators.

Auckland International Airport decreased 0.1 percent to $9.80 after government figures showed a growing number of Australian and American tourists offset a decline in Asian visitors in June. Air New Zealand was down 0.9 percent at $2.73.

Kathmandu Holdings rose for a second day, up 2.9 percent at $2.51. The stock jumped 16 percent yesterday after the retailer said its annual profit rose as much as 13 percent, with accelerating sales in Australia and a good contribution from its North American footwear business. It posted the day's biggest gain.

Spark New Zealand was the most traded stock on a volume of 2.6 million shares, down on its 3.1 million average. It decreased 0.2 percent to $4.13. Summerset Group, which reports earnings on Tuesday, declined 0.2 percent to $5.84.

Outside the benchmark index, Rakon dropped 7.7 percent to 30 cents after holding its annual meeting today where shareholders were told upcoming opportunities weren't likely to boost returns in the current financial year.

Hallenstein Glasson Holdings was unchanged at $5.30 after saying it sold a property in Wellington's CBD and will register a gain of $1.1 million.

Infratil's perpetual infrastructure bonds, which pay annual interest of 3.55 percent, were the most traded debt security with a volume of 283,000. The notes closed at 78.8 cents per $1 face value, up 2.5 cents. Infratil shares rose 1.7 percent to $4.93, a dividend yield of 3.6 percent.

ASB Bank also said it is considering selling up to $100 million of unsecured, unsubordinated five-year notes, with the ability to accept unlimited oversubscriptions. The offer details are expected to be released on Monday. The New Zealand five-year swap rate closed at 0.9785 percent.

(BusinessDesk)

© Scoop Media

 
 
 
Business Headlines | Sci-Tech Headlines

 

Banking: Westpac NZ Lowers Merchant Fees For Small Businesses

Westpac NZ is rolling out a new merchant fee pricing structure that will lead to cost savings for more than 10,000 small and medium Kiwi businesses, and could make contactless transactions more widely available for customers. On 1 September, most ... More>>

REINZ: Million Dollar Plus Property Sales Increase 11.7% Nationally

The number of properties sold around the country for one million dollars or more during the first half (H1) of 2020 increased by 11.7% compared to H1 2019, with 5,426 million-dollar plus properties sold (up from 4,858 in H1 2019) according to the Real ... More>>

Waste: Government To Regulate Plastic Packaging, Tyres, E-Waste

The Government is stepping up action to deal with environmentally harmful products – including plastic packaging, tyres and e-waste – before they become waste. As part of the wider plan to reduce the amount of rubbish ending up in landfills, ... More>>

ALSO:

Bankers Association: Banking Becomes First Living Wage Accredited Industry

Banking has become New Zealand’s first fully living wage accredited industry, leading to nearly 1800 employees and contractors moving onto the living wage and gaining greater economic independence for them and their families. As of today, all ... More>>

ALSO:

Economy: Funding For 85% Of NZ Not-For-Profit Entities Impacted By COVID-19

Results of a recent Institute of Directors poll show that 85% of board members on not-for-profit organisations say COVID-19 has moderately or significantly affected their funding. The ‘pulse check’ conducted in the first two weeks of July looked ... More>>

Volcano Detection: Eruption Alert System Would Have Given 16 Hours’ Warning At Whakaari

An alert system that could have given 16 hours’ warning of last year’s eruption at Whakaari/White Island is ready for deployment, University of Auckland scientists say, with warning systems for Ruapehu and Tongariro the next priority. ... More>>


Property: Queenstown Rents Experience Biggest Drop In Seven Years

Rental prices in the Queenstown-Lakes district saw the biggest annual percentage drop in seven years after falling 28 per cent on June last year, according to the latest Trade Me Rental Price Index. Trade Me Property spokesperson Aaron Clancy said ... More>>

Seismology: The Quiet Earth

As many daily activities came to a halt during lockdown, the Earth itself became quiet, probably quieter than it has been since humans developed the technology to listen in. Seismologists have analysed datasets from more than 300 international ... More>>

RNZ: James Shaw Says Kiwibank, Not Ministers Should Decide On Investors

Climate Change Minister James Shaw says Kiwibank's decision to stop doing business with companies dealing in fossil fuels is the right one. More>>

ALSO:

FMA: Kiwis Confident Financial Markets Will Recover From COVID-19, Plan To Increase Investments

Despite the majority (60%) of investors experiencing losses as a result of COVID-19, the outlook on investing remains positive, according to a Financial Markets Authority (FMA) survey. Most Kiwis (71%) were optimistic that the pandemic will pass eventually ... More>>

FIRST Union: Warehouse Using Covid For Cover As Extensive Restructure Makes Everyone Worse Off

(FIRST Union comments on The Warehouse consultation and proposed restructure) 'Unfortunately the Warehouse have done the disappointing thing and used Covid-19 to justify a bunch of operational business decisions that will leave hundreds of workers without jobs ... More>>

ALSO:

Stats NZ: Mixed Performance By Regions Leaves National Emissions Picture Unchanged

Approximately two-thirds of New Zealand’s regions recorded decreases in their total greenhouse gas emissions, while one-third of regions saw increases between 2007 and 2018, Stats NZ said today. “While some regions reduced their emissions, ... More>>

RNZ: Economic Activity And Business Confidence Bouncing Back

Two surveys from ANZ show business confidence and economic activity have rebounded, but uncertainty about the future remains extreme. More>>

ALSO: