New Zealand is keenly eyeing a new wave of optimism as the country prepares to step down from alert level 4 in an attempt to restart parts of the economy, although the extent to which safety restrictions will ease is yet to be seen.
The Finance Minister Grant Robertson has indicated the possibility for New Zealand to enter alert level 3 that would bring construction workforce back into action. The final decision, however, remains with the government announcement on the fight against the coronavirus pandemic expected this week.
The evidence of the declining infection rate and the safe economic activity levels seem to be the two most crucial factors in the government’s checklist before moving ahead with any relaxation on lockdown restrictions.
Daily activities are likely to be more profound with businesses coming back to operational stage to an extent, under the level-3 alert. This alert level was experienced by the country for merely 48 hours before it advanced to the further stringent precautionary measures on 26 March.
Director-General of Health Ashley Bloomfield stated ‘its clear New Zealand is past the peak’ of coronavirus cases. That means the worst of coronavirus is over for the country.
Bloomfield further highlighted the positive impact of the strict lockdown measures as the number of new COVID-19 cases is gradually stabilising in New Zealand. Besides lockdown, the country has taken up an advanced level of medical measures in a bid to contain virus, along with maintaining a ‘low threshold’ to ensure that anyone with even the low-level of respiratory symptoms also gets tested.
With the ‘sobering reminder’ of what is at stake, the Ministry of Health on Tuesday reported four COVID-19 related deaths and 17 new cases, consisting of eight new confirmed and nine new probable cases. This brings the total number of infections to 1366 in New Zealand, including nine fatal causalities mostly related to senior citizens. However, the new cases slowing in the country have sent a positive signal with as low as 18 cases in a day, last week.
Stocks Move Up Despite COVID-19 Impacts
The promising signs of virus slowdown have sent a wave of optimism to several businesses operating in New Zealand. Geo Limited (NZX:GEO), Kathmandu Holdings Limited (NZX: KMD), Air New Zealand Limited (NZX:AIR) have been some of the top gainers as on 15 April 2020.
Jewellery Retailer, Michael Hill International Limited (NZX: MHJ) reflected a silver lining on the share price movements in the past week as its stock price surged up from $0.240 on 8 April 2020 to 0.380 on 15 April 2020.
Likewise, Blis Technologies Limited (NZX: BLT) stock rallied in April, surging by over 50% from 31 March 2020 to $0.090 on 15 April 2020.
The redemptions in the travel industry seem promising with the corporate travel management group, Serko Limited (NZX: SKO) recognising substantial gains amidst the Easter buzz. The stock zoomed by 38.4% from 8 March 2020 to $2.70 on 15 April 2020. Meanwhile, in the same period, Vista Group International Limited (NZX: VGL) share price appreciated by 32.38%.
Fallouts: Burger King New Zealand Goes Into Receivership As It Strives To Stay Afloat
It seems COVID-19 lockdown has meant a hard hit on the owners of New Zealand’s Burger King franchise. In an official letter to its employees, Burger King NZ stated that the company has seen no sales since the lockdown and they “do not currently have the cash flow to fund trade creditors and rent payment.”
The food-chain is now seeking to go into receivership to get the business restarted post-lockdown and then retain the Burger King operating in New Zealand under a new owner through the sales process. Operating 83 burger stores with over 2600 staff across the country, Burger King NZ appointed KordaMentha and Grant Graham as receivers on Tuesday. However, the company chain is seemingly utilising the government wage subsidy scheme to fund the staff payment during the COVID-19 crisis.
Its parent shareholding companies in receivership include Tango New Zealand Limited, Tango Finance Limited, and Antares New Zealand Holdings Limited.
PM Jacinda Ardern has hinted the government’s concern over the fixed costs for businesses while discussing plans about unveiling further assistance to the businesses.
Although New Zealand has shown some early signs of recovery through the implementation of radical measures towards the containment of the epidemic, the significant level of economic uncertainties continues to hover around the financial health and survival of the businesses. Virus containment and further flattening of the curve is closely monitored by market analysts to further gauge the victory over the health and financial crisis.