New Zealand shares fell as blue-chip stocks trading near record-highs gave up some of their recent gains. Infratil led the market lower after shedding rights to its final dividend.
The S&P/NZX 50 Index decreased 14.07 points, or 0.1 per cent, to 10,290.76. Within the index, 32 stocks fell, 16 rose, and two were unchanged. Turnover was $125.8 million.
The local market was one of just four benchmark indices in the red across Asia, with equities generally stronger in the wake of a Federal Reserve policy review keeping the door open for lower interest rates in the US. The NZX hit an all-time high yesterday, with investors attracted to a large number of companies offering reliable dividends at a time when low rates limit investment options.
"Some stocks that performed well yesterday have completed reversed," said Grant Williamson, a director at Hamilton Hindin Greene.
Ebos Group fell 3.4 per cent to $22.70 on 104,000 shares, in line with its 90-day average. The healthcare and animal care products maker hit a record $23.70 yesterday. Mainfreight declined 1.3 per cent to $39 on a bigger than usual volume of 102,000 shares, having peaked at $40.25 on June 14.
Genesis Energy fell 1.1 per cent to $3.20 from yesterday's record of $3.315, and Goodman Property Trust was down 0.3 per cent at $1.895, having hit an all-time high $1.91 today.
Not all blue-chips retreated, with Meridian Energy hitting a record $4.85 before closing at $4.72, up 2.2 per cent on a volume of 2.6 million shares. Auckland International Airport rose 1.9 per cent to a record $9.20 on 851,000 shares.
Williamson said a growing number of analysts say Auckland Airport is overvalued, but pointed out it's a core portfolio stock and in demand among investors.
"More money is coming into the market and needs a heavier weighting in Auckland Airport," he said.
Infratil led the market lower, down 3.7 per cent, or 17 cents, at $4.48 on a volume of 1.1 million shares. It shed rights to an 11-cent dividend today, having climbed to a record $4.70 yesterday. Investors had already flocked to the stock due to its collection of infrastructure assets, and that appeal was boosted when Infratil last month announced plans to buy Vodafone New Zealand with Brookfield Asset Management for $3.4 billion.
Fisher Funds Management today aired its support for the plan in its monthly update for investors in the Kingfish entity it manages. Portfolio manager Sam Dickie likened the deal to Infratil's successful foray into retail fuels when it helped form Z Energy, generating substantial value for investors. Kingfish fell 0.7 per cent to $1.44.
Z Energy fell 0.7 per cent to $6.08 on a volume of 1.5 million shares. It updated shareholders on its strategy at today's annual meeting. New Zealand Refining fell 2.4 per cent to $2.04.
Kiwi Property Group declined 0.6 per cent to $1.59 with 1.3 million shares changing hands. The property investor today told shareholders it was considering adding residential development to its mixed-use sites.
Air New Zealand decreased 0.7 per cent to $2.69 on a volume of 896,000 shares, less than its usual volume of 1.1 million. Chief executive Christopher Luxon last night announced plans to leave the national carrier in September, ending an eight-year run with the company.
Williamson said Luxon had a good reputation, but the decline wasn't too much of a reaction.
"It's been known for some time that he was always going to retire in the relatively short-term," he said.
Spark New Zealand was the most active stock on the benchmark index with a volume of 3.8 million shares, less than its 5.4 million average. It rose 1.9 per cent to $3.99.
Of other stocks trading on volumes of more than a million shares, Contact Energy fell 1.5 per cent to $7.48, Argosy Property rose 0.8 per cent to $1.345, Fletcher Building decreased 0.6 per cent to $5.40, and Investore Property was up 0.6 per cent at $1.83.
Outside the benchmark index, Cannasouth increased 2.5 per cent to 41 cents, with 536,000 shares changing hands. The pre-revenue medicinal cannabis firm listed yesterday after raising $10m in the market's first initial public offering for more than two years.
Williamson said investors who bought into the IPO or priority offer at 50 cents were still underwater and questioned why the company listed so early.
"When stocks do an IPO like this and fail, it does nothing for the reputation of the market and continues to put some smaller investors off the market," he said.
NZX fell 0.9 per cent to $1.08. It today accredited investment platform start-up Sharesies as a market participant. Next month, investors will be able to buy stocks on the main board directly via Sharesies, and will be able to buy fractions of shares, something not offered elsewhere.
Williamson said any initiative to broaden participation in the market was a good thing, noting that small investors often turn into large ones over time.
Summerset Group's 2025 bonds paying annual interest of 4.2 per cent were the most traded debt security, with a volume of 3.8 million. The notes closed at a yield of 3.1 per cent, down 2 basis points. Summerset shares fell 1.1 per cent to $5.41.
Mercury NZ's 6.9 per cent capital bonds, which will be redeemed next month, closed at an unchanged yield of 3.2 per cent on a volume of 1.1 million. Mercury's shares increased by 0.2 per cent to $4.11.