“Markets want to see further stimulus – we are talking trillions of RMB – to give consumers confidence and put a line under the residential market.”
The September BusinessNZ Performance of Manufacturing Index was 46.9, up from 46.1 in August, showing the sector continued to show higher levels of activity.
Solly said the index needs to be above 50 to show expansion but at least it is bouncing off the bottom as business sentiment improves.
The United States markets were still a little nervous about inflation after the September consumer price index showed the annual rate at 2.4%, down from the previous 2.5% but higher than the expected 2.3%.
“Inflation is dying but it’s not dead yet,” said Solly. “But there’s still a probability that the Federal Reserve will cut its official rate by 25 basis points next month.”
The Dow Jones Industrial Average was down 0.14% to 42,454.12 points; S&P 500 declined 0.21% to 5780.5; and the Nasdaq Composite was flat at 18,282.05.
At home, the market was driven up by Fisher and Paykel Healthcare, up 60c to $37.20; Ebos Group increasing 72c or 1.96% to $37.42; and Infratil gaining 23c or 1.9% to $12.34.
Freightways added 10c to $9.69; Ryman Healthcare gained 8c to $4.98; Scales Corp increased 15c or 4.11% to $3.80; Briscoe Group collected 5c to $5; and Michael Hill improved 2c or 3.57% to 58c.
Chorus, up 8c to $8.85, told the market its total fibre connections increased by 8000 in the quarter ending September. The network footprint now includes 1.514 million addresses. Birkdale in Auckland has become the first fibre-only exchange which had 7000 copper connections when the roll-out began in 2011.
Ventia Services, up 5c to $5.25, has been awarded a contract worth $150m over three years to extend NBN Co’s fibre network in regions within Queensland, New South Wales, ACT, Victoria and Tasmania.
Other gainers were Accordant Group increasing 3c or 7.5% to 43c; T&G Global up 3c or 2.01% to $1.52; Green Cross Health adding 3c or 4.05% to 77c; Marsden Maritime Holdings collecting 7c or 1.98% to $3.61; and Burger Fuel collecting 1.5c or 5.26% to 30c.
Fletcher Building, up 1c to $3.09, has completed its $700m capital raise after attracting a further $113m in its retail entitlement offer.
Tower was up 1.5c to $1.37 after upgrading its full-year net profit guidance to $83m, up from greater than $45m, because of no large events in the financial year.
Solly said it was understood Tower was making a $6m provision for customer remediation.
Meridian 9c to $5.85; Skellerup Holdings shed 9c or 1.95% to $4.53; Rakon was down 2c or 2.82% to 69c; The Warehouse declined 4c or 3.54% to $1.09; Seeka decreased 6c or 2.26% to $2.60; and Pacific Edge was down 0.006c or 3.73% to 15.5c.
ArborGen Holdings, unchanged at 13.6c, has an agreement to buy Brazilian nursery Eco Empreendimentos for US$2.5m ($4.1m). The nursery has annual production of 15 million eucalyptus seedlings and takes ArborGen’s total Brazilian production to 94 million seedlings – 77 million eucalyptus and 17 million pine.
