Market close: NZ stocks fall as hesitant investors await Reserve Bank’s OCR call

Photo / NZME

A hesitant New Zealand share market fell nearly half a per cent as it waited for the latest interest rate decisions from the central banks of each side of the Tasman.

The S&P/NZX 50 Index reached an intraday low of 11,795.8 points before recovering slightly in the last half-hour matching session, and closed at 11,838.79, down 45.7 points or 0.38 per cent.

There were 72 gainers and 63 decliners on the main board, on a steady volume of 29.67 million share transactions worth $104.52 million.

Jeremy Sullivan, investment adviser with Hamilton Hindin Greene, said it was disappointing to see the market fall after a strong Friday in the United States.

“But people are sitting on their hands pending the outcomes of the monetary policy review meetings in Australia and New Zealand this week. All eyes will be on the commentary and economic outlook accompanying both Reserve Banks’ decisions.”

The Reserve Bank of Australia is meeting on Tuesday and may even put interest rate rises on hold. The New Zealand Reserve Bank follows on Wednesday and is expected to increase the official cash rate 25 basis points to 5 per cent.

Sullivan said: “[The] Australian bank is not as hawkish as ours. The New Zealand bank has a bit to digest, especially the impact of Cyclone Gabrielle, and our inflation is still red hot. There is uncertainty over whether the bank will give credence to slowing the rate of increase.”

Another added inflationary pressure is the sudden rise in oil prices, he said.

Saudi Arabia, Iraq and several Gulf states are cutting oil production by more than one million barrels a day to boost prices amid fears of weaker demand.

Crude oil jumped 7 per cent to US$81.74 a barrel, up from $75.38, and settled at $79.71 at 5pm NZ time.

On Wall Street, the major indices ended the week with a three-day rally. The Dow Jones Industrial Average was up 1.26 per cent to 33,274.15 points; S&P 500 gained 1.44 per cent to 4109.31; and Nasdaq Composite increased 1.74 per cent 12,221.91.

The markets had a boost after the Federal Reserve’s inflation gauge showed a cooler-than-expected increase in prices. The core Personal Consumption Expenditures index, which excludes energy and food costs, rose 0.3 per cent in February, less than the 0.4 per cent expected by economists.

The S&P 500 and Nasdaq were up 7.03 per cent and 16.77 per cent respectively for the first quarter. It was the best quarter since 2020 for the tech-heavy Nasdaq.

At home, leading utility stocks dipped on the fear that interest rates will rise.

Contact Energy was down 10c to $7.64; Meridian declined 12c or 2.29 per cent to $5.13; Vector shed 8c or 1.98 per cent to $3.97; Manawa decreased 7c to $4.90; and Infratil was down 15c to $9.05.

Fisher and Paykel Healthcare declined 11c to $26.54; Ebos Group was down $1 or 2.15 per cent to $45.50; Skellerup Holdings fell 28c or 5.35 per cent to $4.95; Restaurant Brands shed 22c or 3.27 per cent to $6.50; Comvita decreased 12c or 3.81 per cent to $3.03; and Scales Corp was down 7c or 2.16 per cent to $3.17.

Retailers The Warehouse Group increased 4c or 2.16 per cent to $1.89; Briscoe Group rose 21c or 4.6 per cent to $4.78; and Michael Hill gained 2c or 1.89 per cent to $1.08.

Channel Infrastructure declined 4c or 2.65 per cent to $1.47 after telling the market its chief financial officer, Jarek Dobrowolski, has resigned and will be leaving during June.

Other decliners were T&G Global down 4c or 1.9 per cent to $2.06; Vista Group shedding 6c or 4.32 per cent to $1.33; Task Group falling 2.5c or 7.58 per cent to 30.5c; and Serko decreasing 9c or 3.77 per cent to $2.30.

Pushpay Holdings, up 1c to $1.40, is holding its shareholder meeting on April 27 to vote on the improved takeover offer of $1.42 a share from investment firms, Sixth Street and BGH Capital. The increase of 8c a share is likely to be approved.

Foley Wines was up 2c to $1.34 following the resignation of founder Bill Foley as director and chair. He will be replaced as chairman by Paul Brock, and son Robert Foley becomes a director. Billionaire Bill Foley is concentrating on his new investment after buying English premier league football club AFC Bournemouth.

Other gainers were Auckland International Airport up 8c to $8.78; Air New Zealand increasing 1.5c or 1.96 per cent to 78c; Freightways improving 14c to $9.59; Ryman Healthcare adding 12c or 2.29 per cent to $5.37; Gentrack rising 13c or 4.61 per cent to $2.915; and Radius Residential Care up 1.5c or 6.38 per cent to 25c.

Ventia Services increased 7c or 2.53 per cent to $2.84; Heartland Group added 4c or 2.56 per cent to $1.60; Arvida Group was up 3c or 3.23 per cent to 96c; NZ King Salmon Investments gained 1c or 4.88 per cent to 21.5c; and TradeWindow improved 1.5c or 4.48 per cent to 35c.