Market close: NZ shares run out of puff; price of oil falls

The crude oil price went under US$100 a barrel and was trading at US$99.14 at 5.45pm. Photo / AP

The New Zealand sharemarket ran out of puff in a rocky session as the uncertainty over rising inflation and the Ukraine war prevailed. But there was one bright spot – the oil price fell as the United States and other allies increased the supply.

The S&P/NZX 50 Index was up and down all day on light trading as investors hung back. The index declined 20.83 points or 0.17 per cent to 12,089.43 after reaching an intraday high of 12,110.26 and low of 12,054.19.

There were 60 gainers and 78 decliners over the whole market, with 29.87 million shares worth $123.31 million changing hands.

The NZX index was down just 0.3 per cent for the week and fell nearly 7.8 per cent in the March quarter. On Wall Street, the Dow Jones Industrial Average was down 4.6 per cent, S&P 500 declining 4.9 per cent and Nasdaq Composite falling 9 per cent in the same quarter – the worst since the start of 2020 when Covid-19 struck.

The crude oil price went under US$100 a barrel and was trading at US$99.14 at 5.45pm NZ time after reaching a low of US$98.60.

The United States is releasing one million barrels a day from its reserves for six months (a total of 180m barrels), and its allies are chiming in with 30-50 million more barrels. Opec agreed to raise output targets by 432,000 barrels a day by May 1.

But inflation won't go away. The US Federal Reserve's preferred inflation gauge, the personal consumption expenditures price index, hit 5.4 per cent compared with the same time last year – the highest level since 1983.

Greg Smith, head of retail with Devon Funds Management, said moderating commodity prices would ease inflationary pressures, but these were already elevated as a consequence of pandemic-induced stimulus, and would need to be dealt with by higher interest rates. This would likely have valuation consequences for higher-priced growth stocks.

Fisher and Paykel Healthcare was up 15c to $24.50; Restaurant Brands rose 36c or 2.6 per cent to $14.20, Skellerup Holdings increased 9c to $6.06; Briscoe Group collected 8c to $5.83 and fellow retailer KMD Brands gained 3c or 2.21 per cent to $1.39.

EBOS Group was down 61c to $40.86; Mainfreight shed 50c to $83.25; Auckland International Airport declined 8c to $7.75; and Contact Energy decreased 10c to $8.05.

Synlait Milk gained 4c to $3.35 after making a strong recovery in the six months ending January, after its first loss in eight years. Synlait reported a 338 per cent rise in net profit to $27.9m, including a one-off gain on the sale of Auckland property, on revenue of $790.6m, up 19 per cent.

Adjusted net profit was $14.5m, up 128 per cent, and operating earnings (ebitda) increased 45 per cent to $68.4m. Synlait is not paying an interim dividend, and it warned the second-half profit growth won't be as strong because of the Omicron impact, labour shortages, supply chain disruption and high dairy commodity prices.

Heartland Group Holdings increased 3c to $2.28 after telling the market it is buying Australian (cattle and sheep) livestock finance business StockCo for A$143m ($154m), with a potential top-up of A$11m. The financing market is estimated to be worth A$7 billion and the purchase would add A$10-$12m to Heartland's annual net profit.

Air New Zealand, seeking $1.2b from investors, was down 2.5c or 1.94 per cent to $1.265 and the big test for its share price will come next week when the stock goes ex-rights.

Other decliners were Ryman Healthcare, down 21c or 2.24 per cent to $9.17; Kiwi Property decreasing 2c or 1.82 per cent to $1.08; and TradeWindow falling 8c or 4.21 per cent to $1.82.

Among the gainers, Goodman Property Trust was up 5c or 2.12 per cent to $2.41; Ventia Services Group increased 6c or 2.29 per cent to $2.68; Tourism Holdings collected 9c or 3.15 per cent to $2.95; Turners Automotives improved 6c to $4.11; and My Food Bag picked up 3c or 3.23 per cent to 96c.

The High Court has dismissed a judicial review application by Winton Land over the Overseas Investment Office decision to grant CDL Investments New Zealand consent to buy land in Havelock North. Winton is appealing. Property developers CDL was up 1c to $1.19 and Winton increased 14c or 4.24 per cent to $3.44.

ArborGen Holdings, down 1c or 4.17 per cent to 23c, told the market it suffered frost and wind damage to pine flowers during the pollination season at its United States southern coastal orchards, resulting in a lower seed harvest in November 2023.

Channel Infrastructure (formerly Refining NZ) had its first day operating as a fuel import terminal at Marsden Point near Whangarei, with long-term service agreements with BP, Mobil and Z Energy. Channel's share price increased 1c to $1.05.