Market close: Spectre of inflation overhangs NZ sharemarket

Reserve Bank of New Zealand Governor Adrian Orr. The Reserve Bank is expected to lift the official cash rate next week. Photo / Mark Mitchell

The sluggish New Zealand sharemarket, continuing to be rattled by new economic data, had another sharp drop and has now fallen one per cent in two days.

The S&P/NZX 50 Index was trading consistently until mid-afternoon when it suddenly fell – Australia was also having another down day. The NZX index fell 65.3 points or 0.51 per cent to 12,837.4 after reaching an intraday high of 12,931.23.

There were 56 gainers and 80 decliners across the whole market, with 40.28 million shares worth $168.97 million changing hands.

The S&P/ASX 200 Index added to the softer transtasman sentiment, having fallen 0.97 per cent to 7348.3 points at 5.45pm NZ time.

Greg Smith, head of retail for Devon Funds Management, said the December 15 opening of the Auckland border added some positivity, and it looks like the city's freedom day will be at the end of this month.

But the spectre of inflation and the Reserve Bank meeting next week still overhangs the market, he said.

The Producer Price Index had its largest rise in 12 years – the prices received by producers for the year ending September increased 6.2 per cent, and the prices paid were up 7 per cent.

The Reserve Bank is this week releasing its latest quarterly survey on expectations for the economy.

"The latest economic data is reminder that inflation is still rising and this will seal another official cash rate increase next week, and interest rates will keep heading upwards," said Smith.

The leading retirement village stocks continue to be under pressure, with the housing market likely to slow with a levelling off in prices and tighter credit. Ryman Healthcare was down 35c or 2.5 per cent to $13.65, and Summerset Group Holdings declining 22c to $13.48.

Contact Energy was down 19c or 2.36 per cent to $7.86; Ebos Group shed 45c to $36.50; Freightways fell 30c or 2.36 per cent to $12.40; Restaurant Brands declined 34c or 2.29 per cent to $14.51; NZX decreased 5c or 2.78 per cent to $1.75; and Gentrack was down 6c or 3.11 per cent to $1.87.

Interest rate-sensitive property companies Investore rose 7c or 3.76 per cent to $1.93, while Stride lost 3c to $2.22 and Goodman Property Trust was down 3.5c to $2.43. Vital Healthcare Property Trust told the market it is on track to achieve full-year earnings guidance of at least 11.8c a unit, up 2 per cent on the previous year, and distribution of 9.5c a unit, an increase of 7 per cent. Vital's share price declined 3c to $2.92.

The leading banks were softer, ANZ Banking Group falling 69c or 2.33 per cent to $28.87 and Westpac Banking Corporation down 42c to $23.38.

Amongst the retailers, Briscoe Group gained 6c to $6.95; Hallenstein Glasson was down 9c to $6.95; and The Warehouse Group which went ex-dividend declined 3.5c to $3.93.

Comvita was up 9c or 2.56 per cent to $3.60; Scales Corporation rose 12c or 2.23 per cent to $5.50; Serko gained 14c to $7.94; NZME picked up 4c or 3.1 per cent to $1.33; Harmoney collected 5c or 2.73 per cent to $1.88; and Allied Farmers increased 3c or 4 per cent to 78c.

Fisher and Paykel Healthcare, down 7c to $31.50, has launched a high-performance hospital under-nose mask for non-invasive ventilation, called F&P Visairo, in the United States.

Global marketer a2 Milk told shareholders at its annual meeting that platform rankings were maintained or improved relative to competition in the Chinese November 11 Singles' Day online sales. The share price for a2 Milk was down 4c to $6.27.

Mercury Energy has issued A$200m ($208.1m) worth of seven-year green bonds in the Australian debt market – the first New Zealand corporate to make such a move – and its share price increased 8c to $6.

Move Logistics rose 6c or 3.31 per cent to $1.87 after completing its $40m capital raising. The final component, the retail entitlement offer and bookbuild, raised $13m at $1.74 a share.

Mobile engagement software firm Plexure Group fell 7c or 13.46 per cent to 45c after reporting an increased loss of $8.49m for the six months ending September. Revenue was down 7 per cent to $13.52m. Plexure has just merged with Task Software which has brought new contracts onboard, including with Compass Group, Gloria Jeans and Starbucks Australia.

Geneva Finance has been censured and fined $65,000 by the NZ Markets Disciplinary Tribunal for the time it took to report a 56 per cent increase in profit on March 15. The tribunal found Geneva had material information on March 2 and breached listing rules by not releasing the earnings guidance promptly. Geneva's share price was unchanged at 74c.