The New Zealand sharemarket put in another stoic performance with a near 1 per cent rise as falling interest rates soothed a further drop in business confidence.
The S&P/NZX 50 Index had a strong afternoon and closed at 10,965.17, up 102.83 points or 0.95 per cent, after reaching an intraday low of 10,858.05. The index has begun this week with a near 2 per cent gain.
There were 91 gainers and 44 decliners on the main board with 18.56 million shares worth $68.69 million changing hands.
Jeremy Sullivan, investment advisor with Hamilton Hindin Greene, said a fall in bank swap rates – the largest since October last year – sparked a broad rally on the local market.
"People are starting to see the possibility of a recession with the softening economic outlook, and interest rates will ebb. This has to be good for stock valuations."
Sullivan said the market is starting to look further ahead and realising that inflation may have peaked at the end of June. The inflation rate for the last quarter will be released on July 18.
The latest NZ Institute of Economic Research's quarterly survey of business opinion showed overall confidence was now at its lowest since March 2020, when the Covid pandemic first hit.
A net 62 per cent of respondents expected conditions to deteriorate, as against 34 per cent in the March quarter, with the services and building sectors the most downbeat in the June quarter.
Across the Tasman, the Reserve Bank raised its official cash rate by another 50 basis points to 1.35 per cent. The S&P/ASX 200 Index was up 0.44 per cent to 6641.7 points at 6pm NZ time.
At home, heavyweight Fisher and Paykel Healthcare drove the market higher, rising 70c or 3.54 per cent to $20.50 on trade worth $18.81m.
Auckland International Airport was up 10c to $7.43; Port of Tauranga gained 19c or 3.02 per cent to $6.48; Freightways collected 18c or 1.96 per cent to $9.38; Restaurant Brands increased 12c to $11; and Comvita was up 8c or 2.568 per cent to $3.18.
Energy stocks had a good day. Contact increased 13c or 1.77 per cent to $7.28; Mercury rose 20c or 3.65 per cent to $5.68; Meridian was up 10.5c or 2.24 per cent to $4.80; and Vector gained 8c or 1.9 per cent to $4.30.
Travel and leisure stocks Air New Zealand was up a further 1.5c or 2.44 per cent to 63c; and Tourism Holdings increased 11c or 4.55 per cent to $2.53.
Michael Hill International rose 7c or 6.14 per cent to $1.21; Synlait Milk gained 7c or 2.22 per cent to $3.22; Property for Industry increased 4c to $2.44; and Vista Group was up 4c or 2.41 per cent to $1.70.
Other gainers were Ventia Services Group, up 15c or 5.73 per cent to $2.77; Vulcan Steel increasing 19c or 2.24 per cent to $8.69; Eroad rebounding 14c or 9.52 per cent to $1.61; and Plexure Group collecting 1.1c or 6.51 per cent to 18c.
Chorus, which is increasing its wholesale broadband prices, was down 8.5c to $7.215; Ryman Healthcare decreased 16c or 1.79 per cent to $8.80; Arvida Group shed 3c or 2.07 per cent to $1.42; and AFT Pharmaceuticals declined 9c or 2.47 per cent to $3.55.
Napier Port declined 7c or 2.46 per cent to $2.77; T&G Global was down 10c or 3.57 per cent to $2.70; and Green Cross Health decreased 4c or 3.03 to $1.28.
Transtasman fuel supplier Ampol fell 86c or 2.18 per cent to $38.54 on very light trade.