New Zealand shares gained in the run-up to corporate earnings season, with Contact Energy the first major company out of the blocks on Monday. Australian results have been mixed so far this week.
The S&P/NZX 50 index rose 43.1 points, or 0.5 per cent, to 9,176.61. Within the index, 24 stocks gained, 20 fell, and six were unchanged. Turnover was $101 million, with eight companies clocking in volumes of more than a million shares.
Matt Goodson, managing director at Salt Funds Management, said Australia's reporting season had been mixed so far, but that it really gets underway on both sides of the Tasman next week.
"It's been reasonably quiet here this week," he said.
Contact Energy is expected to post a record first-half result on Monday by Forsyth Barr analyst Andrew Harvey-Green, driven by strong hydro generation and high wholesale electricity prices. The shares rose for a third day, up 1.1 per cent at $6.22 today, the highest close since February 2015. Its volume was lighter than usual at 735,000.
The Reserve Bank of Australia this week opened the door to cutting interest rates, while weaker-than-expected local labour market data encouraged traders to price in a greater chance of a reduction in New Zealand as well. The prospect of lower interest rates helped boost Australasian equity markets on Thursday.
The local market was one of the few to gain today across Asia-Pacific after a weaker lead from Wall Street. Utilities were a favourite among investors given their defensive qualities. Auckland International Airport rose 2.3 per cent to $7.54 on a volume of one million shares, slightly less than its three-month average volume of 1.1 million.
Goodson said Auckland Airport may come under pressure if Air New Zealand's warning of a slowdown in forward bookings spilled over to the airport operator, and also noted that its regulated pricing is under scrutiny. Air New Zealand fell 0.7 per cent to $2.78 on a volume of 1.2 million shares.
Ryman Healthcare led the market higher, up 3.9 per cent at $11.02 on lighter than usual volume of 459,000. Goodson said the stock has been volatile in recent weeks.
Infrastructure investor Infratil gained 2.1 per cent at $3.91, the highest close since the company undertook a two-for-one share split in 2007.
Gentrack rose 1.1 per cent to $5.11 on small volumes after signing a new contract with a UK water retailer.
Spark New Zealand was the most traded stock, with 3.6 million shares changing hands. The shares rose 0.5 per cent to $4.05. Precinct Properties New Zealand fell 0.3 per cent to $1.515 on a volume of 1.5 million shares, twice its average volume. Sky Network Television increased 0.5 per cent to $1.93 on a volume of 1.4 million, compared to a 497,000 90-day average.
Of other companies trading on volumes of more than a million shares, Kiwi Property Group rose 0.7 per cent to $1.435, Meridian Energy was unchanged at $3.65 and Fletcher Building was unchanged at $5.04.
Pushpay Holdings fell 2.9 per cent to $3.34 on a volume of 391,000, in line with its 90-day average. The payments software developer reported a 35 per cent increase in third-quarter sales yesterday, however, Goodson said the revenue per user was a little short of expectations.
"It's always the way with high-growth, glamour-type companies: if they beat expectations there is no price is too high and if they're just a touch soft people tend to run quite quickly," he said.
Tourism Holdings fell 2.3 per cent to $4.69 on lighter than average volumes. NZX was down 2 per cent at 97 cents on a volume of 200,000, more than its 129,000 average.