Market close: NZ shares rise as 'bad news is good news'

New Zealand's benchmark share index rose with US markets. Photo / NZME

New Zealand's benchmark share index rose with US markets, which appear to be expecting weak job data overnight that could make the Federal Reserve (Fed) think twice about aggressive rate hikes.

The S&P/NZX 50 Index rose 68 points, or 0.6 per cent, to 11,417.34.

Turnover was $92.8 million.

Yesterday, markets reacted negatively to strong US manufacturing data. Investors reversed the decline after some weak labour market data emerged.

"Good news is seen as bad news for the market and bad news is seen as good news for the market," BNZ strategist Jason Wong said.

In essence, bad economic data might dissuade the Fed from pushing through rate hikes which slow the economy and hurt equity valuations. A more important US labour market data release is scheduled for Friday night, NZ time.

A basket of stocks sensitive to economic growth moved higher on Friday.

Vulcan Steel rose 2.7 per cent to $9.70, Fletcher Building rose 2.2 per cent to $5.54, and NZ Oil and Gas was up 2.2 per cent at 47 cents.

Heavyweight stocks boosted the index's headline gain. Mainfreight was up 2 per cent at $81.55, Auckland International Airport rose 2 per cent to $7.74 and Meridian Energy climbed 1.8 per cent to $4.785.

As expected, there were no changes to which stocks will be included in the S&P/NZX indices after the June 2022 quarterly rebalance.

My Food Bag Group continued to gain ground, up 4.4 per cent at 94 cents. NZME shares fell 0.8 per cent to $1.28, after large shareholder Osmium Partners said they had sold more than $11m worth of shares in the three months ended May.

Equity analysts at Macquarie recently downgraded the entire listed Australian media sector as the risk of an economic slowdown grows and threatens advertising revenue.

Sky Network Television shares fell 2.2 per cent to $2.64 and honey maker Comvita declined 0.3 per cent to $3.31, despite takeover rumours still lingering around both stocks.

Pacific Edge fell 2.5 per cent to 79 cents, and Ryman Healthcare dropped 3 per cent to $9.25. Shares in stock market operator NZX declined 1.6 per cent to $1.26 despite a big increase in trading volumes during May.

The total value traded across the NZX was $3.87 billion, an increase of 22 per cent from April. The increase was strongest in wholesale trading, which lifted 24 per cent, while retail trading also rose 10 per cent.

This boost was largely driven by Ryman Healthcare falling out of an MSCI Standard Index at the end of May, forcing index trackers to trade out of the stock.

The NZ dollar was trading at 65.55 US cents at 3pm in Wellington, up from 64.72 yesterday. Investors' willingness to take on risk meant they sold the US dollar and pushed the Aussie and NZ dollars up in comparison. The trade-weighted index was at 72.59, from 72.02 yesterday.