Market close: NZ shares follow sharp rise on Wall St as Omicron fears fade

The New Zealand sharemarket rose more than 2 per cent - its biggest gain for the year. Photo / NZME

The New Zealand sharemarket struck its biggest gain of the year, rising more than 2 per cent, on the back of a sharp rally on Wall Street as Omicron variant fears fade.

The S&P/NZX 50 Index climbed steadily all day and closed at 12,868.32, up 258.44 points or 2.05 per cent. It easily surpassed the previous best one-day gain of 1.87 per cent achieved on August 19.

There were 113 gainers and just 29 decliners over the whole market on strong volume of 75.78 million share transactions worth $273.11 million.

Greg Smith, head of retail with Devon Funds Management, said while the jury is still out on the Omicron health impact and efficacy of vaccines, anecdotal evidence is positive.

"We aren't seeing an increase in hospitalisation, even in the epicentre of South Africa, and if the virus evolves into something benign, then that is great news."

Smith said the local market took a good lead from the United States and "we have seen some dip buying of stocks that have been under pressure, though Sky TV is an extreme example."

Overnight, Wall Street had its second successive big rebound led by the technology-driven Nasdaq Composite, surging 461 points or 3.03 per cent to 15,686.92 – its biggest one-day gain since March 9.

The Dow Jones Industrial Average was up 1.4 per cent, and a total of 3.27 per cent in two days, to 35,719.43; and the S&P 500 increased 2.07 per cent to 4686.75.

At home, market leader Fisher and Paykel Healthcare rose $1.13 or 3.55 per cent to $32.99 on trade worth 22.18m; Mainfreight gained $1.30 to $90; Ebos Group increased $1 or 2.82 per cent to $36.50; Fletcher Building climbed 28c or 4.06 per cent to $7.18; and Chorus collected 24c or 3.52 per cent to $7.05.

Auckland International Airport was up 8.5c to $7.815; a2 Milk gained 9c to $5.89; Spark increased 6.5c to $4.52; Port of Tauranga collected 14c or 2.04 per cent to $7; Skellerup Holdings rose 11c or 1.81 per cent to $6.18; and Infratil was up 13c to $8.18.

Ryman Healthcare is back in development mode, increasing 17c to $12.04 after telling the market it has bought a 6ha site in north west Melbourne for a $155m retirement village, including specialist dementia care. Summerset Group Holdings was up 7c to $13.10; and Arvida was down 3c to $1.92.

Among energy stocks Meridian was up 10c or 2.14 per cent to $4.77; Mercury gained 12c or 2.05 per cent to $5.97; and Genesis increased 2.5c to $2.995.

Property companies also recovered. Argosy increased 5c or 3.42 per cent to $1.51; Goodman Property Trust was up 5c or 1.97 to $2.59; Precinct Properties rose 6.5c or 4.19 per cent to $1.615; and Kiwi Property gained 2.5c or 2.16 per cent to $1.18.

Pushpay Holdings and Serko came alive, rising 7c or 5.34 to $1.38 and 45c or 6.98 per cent to $6.90 respectively. SkyCity Entertainment was up 7c or 2.24 per cent to $3.19; and Pacific Edge gained 5c or 3.94 per cent to $1.32.

Sky Network Television topped the gainers list for the second day running, rising 30c or 14.56 per cent to $2.36 following its increased earnings forecast. Sky TV has now risen nearly 32 per cent in two days and analysts have raised their 12-month target price, ranging from $2.42 to $3.

Smith said investors are tuning into Sky TV for the first time in a long time. "They have taken costs out of the business and their earnings upgrade was a mildly positive announcement. Have they reached a turning – we will just have to wait and see?"

Other gainers were Restaurant Brands collecting 29c or 1.95 per cent to $15.20; Move Logistics rising 5c or 3.07 per cent to $1.70; NZX collecting 5c or 2.86 per cent to $1.80; EROAD increasing 9c or 1.87 per cent to $4.90; and NZME up 4c or 2.88 per cent to $1.43.

Retailers Kathmandu Holdings gained 7c or 4.79 per cent to $1.53, and Michael Hill International increased 4c or 3.39 per cent to $1.22.

Scales Corporation rose 18c or 3.22 per cent to $5.60 after providing 2022 guidance of $30.5m-$35.5m for underlying net profit and $62m-$67m for operating earnings (ebitda). Scales is paying an interim dividend of 9.5c a share on January 14.

Livestock Improvement Corporation gained 8c or 6.56 per cent to $1.30 after declaring its first special dividend of 10c a share, worth $14.2m and paid on January 21, following the sale of its automation business.

Amongst the few decliners, T&G Global fell 8c or 2.64 per cent to $2.95; Marsden Maritime Holdings shed 10c to $6.30; AFT Pharmaceuticals was down 9c or 2.01 per cent to $4.39; Vista Group declined 4c to $2.29; and TradeWindow declined 4c or 2.27 per cent to $1.72.