New Zealand shares fell from a record high as speculation about a Federal Reserve rate hike next month drove up the US dollar and prompted some offshore funds to trim their investments. Auckland International Airport, Meridian Energy and Genesis Energy led a late sell-off.
The NZX 50 fell 79.01 points, or 1.1 per cent, to 6903.63. Within the index, 33 stocks fell, 12 rose and five were unchanged. Turnover was $215 million.
Stock markets were broadly weaker across Asia after the minutes of the last Federal Open Market Committee meeting showed an interest rate hike in the US next month was possible, provided economic data plays out as expected. In the local market, offshore investors sold companies typically held for their relatively attractive dividend yield, local market participants said.
"If rates are going higher then maybe the US dollar is going to be stronger and typically offshore funds would sell assets and bring the money back home," said James Lindsay, senior portfolio manager at Nikko Asset Management.
There was "very heavy offshore selling" in the 30 minutes before the market closed, he said.
Auckland Airport dropped 4.2 per cent to $6.37 while Meridian fell 3.8 per cent to $2.685 and Genesis declined 3.3 per cent to $2.05.
A2 Milk fell 6.4 per cent to $1.61, leading the index lower, which Lindsay said mirrored a sharp drop in shares of Australian companies that had enjoyed a similar rally on their prospects in China, including vitamin maker Blackmores, down 7.1 per cent to A$155.01 on the ASX, and Bellamy's Australia, which fell 4.8 per cent to A$10.23.
Orion Health Group fell 3.1 per cent to $4.69 and Xero declined 2.7 per cent to $16.92.
Infratil fell 2.8 per cent to $3.28 after the Wellington-based investor said it will spend A$392 million for a 48 per cent stake in Canberra Data Centres, teaming up with Australian government pension fund provider Commonwealth Superannuation Corp to buy the data centre business.
Goodman Property Trust fell 0.4 per cent to $1.365 after posting a 4.2 per cent gain in annual earnings as the country's second-biggest listed property investor benefited from cheaper interest costs.
Rakon dropped 9 per cent to 25c after the high-tech components manufacturer turned in an annual loss of $1.7 million, saying telecommunications companies pulled back infrastructure spending, hurting sales at its largest unit.
Coats Group was unchanged at 63c after the UK-based thread-maker reiterated its guidance for a "modest" increase in annual earnings before one-time items and affirmed plans to delist from the NZX and the ASX and keep its London Stock Exchange listing.
Ryman Healthcare fell 1.3 per cent to $9.60 ahead of its full-year results today. Metro Performance Glass rose 2.2 per cent to $1.86 and Summerset Group Holdings rose about 2 per cent to $4.69. Contact Energy gained 0.4 per cent to $5.39.
Nikko's Lindsay said Summerset has benefited from signs of a pick-up in the Auckland housing cycle, as resales of occupation rights in its retirement villages are tied to the housing market. "It has been developing well and is emulating "the successful operations of Ryman".
He said Contact gave an upbeat presentation at the recent Macquarie investor conference and its customer numbers have stabilised.