The NZX ticker in downtown Auckland pays a tribute to Brian Gaynor after his death was announced. Photo / Supplied
The New Zealand sharemarket continued its uncertainty despite a big rebound on Wall Street – and Ryman Healthcare suffered heavily from selling pressure as it falls out of a major global index.
The S&P/NZX 50 Index traded steadily for the most of the day and then dropped off late in the afternoon, closing flat. The index was down 10.51 points or 0.09 per cent to 11,157.66 on light volume of 36.7 million share transactions worth $103.1m.
The intraday high was 11,276.5 points, and there were 89 gainers and 44 decliners across the main board.
Matt Goodson, managing director of Salt Funds Management, said the local market still has a sell tone to it as there was no follow through from a strong lead in the United States.
"Why? Higher interest rates. We are now seeing New Zealand corporate bond issues with rates above mid-5 per cent and they are a powerful instrument for investors seeking alternatives to equity dividend earnings," he said.
The New Zealand market rolled over the latest Chinese retail sales and industrial production showed falls in April. Retail sales fell 11.1 per cent and industrial production was down 2.9 per cent – far worse than analysts expected.
Goodson said that's hardly surprising given the Covid lockdowns in China.
On Friday night (NZ time), the Nasdaq Composite in the US recovered 3.82 per cent to 11,805 points; S&P 500 was up 2.39 per cent to 4023.89; and Dow Jones Industrial Average increased 1.47 per cent to 32,196.66.
The NZ dollar continued to weaken, trading at US62.42c against the American greenback after reaching an intraday high of US62.94c.
At home, Ryman Healthcare shed 73c or 7.77 per cent to $8.66 on trade worth $9.79m after the news that it will be removed from the MSCI Large Cap Index at the end of the month.
Goodson said this move was widely expected and there had been pre-trading. "But whether there has been sufficient trading, we have to wait and see. The pure passive investment funds have to sell, and there's estimates that 25m to 45m of Ryman's total shares have yet to be sold."
Manawa Energy (formerly Trustpower) increased 8c to $7.03 after reporting a 290 per cent increase in net profit to $119.81m on revenue of $1.018 billion, up 3 per cent for the 12 months ending March. Generation was also up 3 per cent to 1760 GWh.
Following the sale of Trustpower's retail business to Mercury Energy, Manawa is paying a special dividend of 35c a share and final dividend of 16c a share on June 17. Manawa expects 2023 operating earnings (ebitdaf) of $140m-$160m and capital expenditure of $45m- $55m.
Mercury was up 11c or 1.95 per cent to $5.76; Fletcher Building gained 13c or 2.21 per cent to $6.01; a2 Milk rose 11c or 2.47 per cent to $4.56; and Synlait Milk was up 7c or 2.25 per cent to $3.18.
Auckland International Airport gained 11c to $7.41 after showing improvement in total passenger volume over March and April. Total numbers were down 14.8 per cent in March and international passengers increased 172 per cent on the previous month. Total April volume increased 4.2 per cent, with international passengers rising 233 per cent.
Steel & Tube increased 6c or 4.32 per cent to $1.45 after upgrading its full-year operating earnings (ebitda) guidance 69 per cent to not less than $64m following a strong performance for the 10 months ending April.
Steel & Tube's revenue was up 25 per cent to $479.3m compared with the previous corresponding period, ebitda rose 81.6 per cent to $53.6m, volumes increased 8 per cent, and gross margin continues to improve.
Fellow processor and distributor Vulcan Steel benefitted from the update, rising 53c or 5.49 per cent to $10.18.
DGL Group rebounded 14c or 4.46 per cent to $3.28 after making another acquisition – this time Temples chemicals warehousing division in Perth for $3.5m, adding 13,000 tonnes of storage capacity.
Other gainers were Chorus increasing 7.5c to $7.18; Sky City Entertainment improving 7c or 2.55 per cent to $2.82; and Fonterra Shareholders' Fund collecting 5c or 1.81 per cent to $2.82.
On the decliners side, Ebos Group shed 54c to $39.45; Spark was down 9c or 1.84 per cent to $4.81; Restaurant Brands decreased 28c or 2.35 per cent to $11.62; and PGG Wrightson fell 11c or 2.37 per cent to $4.54.
Among the retailers Briscoe Group was up 8c to $5.67; Michael Hill International gained 3c or 2.7 per cent to $1.14; and Hallenstein Glasson was down 15c or 2.7 per cent to $5.40.
Among the property companies, Investore was up 4c or 2.67 per cent to $1.54; Goodman Property Trust was down 5c or 2.36 per cent to $2.07; and Precinct Properties declined 4.5c or 3.25 per cent to $1.34.
The market mourned the death of Brian Gaynor, co-founder of Milford Asset Management and longtime business columnist.