New Zealand shares edged higher as growing optimism for a US-China trade deal helped buoy investor sentiment across most of Asia. Auckland International Airport and the Fonterra Shareholders' Fund led the market higher.
The S&P/NZX 50 Index increased 5.11 points, or 0.05 per cent, to 10,793.75. Within the index, 20 stocks rose, 26 fell, and four were unchanged. Turnover was $140.7 million.
Stocks across Asia were broadly stronger, following Wall Street higher, as optimism that the US and China may end their protracted trade war stoked investors' appetite for riskier assets. Australia's S&P/ASX 200 Index was up 0.2 per cent in afternoon trading, Singapore's Straits Times Index rose 0.5 per cent, and Japan's Topix rose 0.9 per cent.
Peter McIntyre, an investment advisor at Craigs Investment Partners, said the local market got a strong lead overnight as US corporate earnings helped push stocks on Wall Street higher. That added to optimism over the trade deal and came ahead of a Federal Reserve policy review where investors expect an interest rate cut.
"Things have been more confident about the US and China trade war," he said.
Auckland Airport, which is New Zealand's main tourist gateway, led the market higher, up 3.2 per cent to $9.235 on a volume of 1.2 million shares, more than its 90-day average of 1 million shares.
Fonterra Fund units advanced 3.1 per cent to $4.27 with 345,000 traded, compared to its 217,000 average. McIntyre said the fund has bounced back strongly since Fonterra Cooperative Group reported its annual result and outlined a new strategy to get the country's dominant milk processor on the right track.
McIntyre said the potential threat hanging over the future of the Tiwai Point smelter continued to weigh on the market, with the electricity generator-retailers contributing a large weighting to the index. Meridian Energy fell 2.3 per cent to $4.70 on a volume of 3.2 million shares, while Contact Energy was down 0.3 per cent at $7.65 with 1 million shares traded. Meanwhile, Genesis Energy rose 2.5 per cent to $3.28 and Mercury NZ increased 0.4 per cent to $5.07 with 1.4 million shares changing hands.
"There's a little bit of profit-taking off the top of the gen-tailers - they've still had a stellar five months or so," McIntyre said.
Spark New Zealand was the most traded stock on a volume of 3.5 million shares, falling 1.4 per cent to $4.38.
Fletcher Building was down 0.9 per cent at $4.56 with 2.2 million shares traded. Fletcher may leave the MSCI New Zealand index in an upcoming reweighting, with some investors predicting Mercury will replace it.
Among other stocks trading on volumes of more than a million shares, Ryman Healthcare decreased 0.2 per cent to $12.72, Goodman Property Trust fell 1.4 per cent to $2.18, and Precinct Properties New Zealand slipped 0.8 per cent to $1.85.
Synlait Milk fell 3.1 per cent to $9.40. The Supreme Court today agreed to hear an appeal over whether there should be covenants restricting land-use on its Pokeno site where it's built a new factory.
NZX posted the day's biggest decline, down 3.9 per cent at $1.22 on a volume of 428,000 shares, compared to its 289,000 average.
Outside the benchmark index, New Zealand Oil & Gas was unchanged at 72 cents after it clarified two items in its proposed scheme of arrangement with major shareholder Ofer Global after intervention by the Takeovers Panel.