NZ stocks make small gain - Market close

The local index was green for the first day this week.

A big news day in New Zealand markets has left the benchmark index relatively flat but in the green for the first day this week.

The S&P/NZX 50 Index closed at 12,428.84, up 16.77 points or 0.14% on Thursday. Across the whole market, 67 shares gained and 62 declined, with 37.1 million shares worth $151.3 million changing hands.

The index ended the day 4.89% below where it was at the beginning of the year.

Peter Sigley, director of institutional sales at Forsyth Barr, said it’s a difficult market, but dramatic swings at big companies have had an outsized effect on the index.

“Fisher & Paykel Healthcare off the back of Trump’s tariffs; Spark on the disappointing result; and then the weakness with Ryman Healthcare around the capital raising,” Sigley said.

After a busy earnings season, the NZ Exchange (NZX) has been quiet on the announcement front this week. However, on Thursday, it served up several surprises.

Sigley said the day’s big news was Air NZ’s announcement that its chief executive, Greg Foran, resigned and will leave the airline in October.

Given Foran’s reputation, Sigley was unsurprised that shares closed the day 2.06% down at 59.5c.

“[Foran] is a hugely respected manager who has been in charge during a very difficult period: through Covid-19, recapitalisation, and now all the issues around the engines.

“He hasn’t had the opportunity to shine in terms of growth and performance but has, without a doubt, made a very positive contribution.”

Also on the leadership front, Michael Hill Jewellers NZ announced its interim replacement for its CEO, Daniel Bracken, who unexpectedly passed away last week. The jeweller’s equities jumped 1.03% to 49c on light volumes.

Spark lost 0.67% to $2.22 after S&P Global Ratings downgraded the telco’s issuer credit rating to A- Stable and negative outlook.

KMD Brands declined 3.9% to 37c, Meridian Energy decreased 1.52% to $5.41, while its competitor Contact Energy shed 0.98% to $9.11.

Another thing that caught Sigley’s eye was NZME’s disclosure that it had received a letter from its new Canadian billionaire shareholder, James “Jim” Grenon, through his entity, JTG 4, containing a proposal to remove the current NZME board.

After trading flat for most of the day, shares of the media company, which owns the Herald and BusinessDesk, rose 4.35% to $1.20 after the announcement.

“It’s difficult to say what [Grenon] is trying to achieve because from the outside, it does look like a pretty well-managed company ... Whether he’s trying to achieve crystallisation of value, or whether there’s some bigger agenda at play. Who would know?”

Fisher & Paykel Healthcare announced that it had signed a building construction contract with Dominion Constructors Limited for a fifth building on its East Tāmaki campus in Auckland. The job was estimated to be worth $250m.

Shares fell 1.1% to $34.30, but Sigley said it was a positive development.

“It’s partly deliberate, but partly also coincidental that will result in the manufacturing base in NZ being bigger than in Mexico, which given the uncertainties out there [Trump tariffs] for now and going forward for a while, as a pretty smart thing to do.”

Other gainers included Vulcan Steel, up 3.71% to $8.67; Infratil, adding 2.64% to $10.50; and Skellerup Holdings, collecting 2.04% to $5.