New Zealand shares fell yesterday to their lowest level this year as offshore volatility weighed on sentiment again with markets across Asia weaker, with the exception of Australia.
The S&P/NZX 50 Index fell 22.81 points to 5546.88. Within the index, 23 stocks fell, 16 rose and 11 were unchanged. Turnover was $143 million.
An uncertain outlook for China's economy spooked investors and weighed on equities.
Australian banking stocks did not fare so well and dual-listed Westpac led the New Zealand benchmark index lower, down 3.5 per cent to $32.57. ANZ fell 2.5 per cent to $29.50. Heartland New Zealand declined 1.7 per cent to $1.13. Metlifecare slipped 1.7 per cent to $4.18. Spark fell 1.3 per cent to $3.17.
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"It's a combination of things. There's China, although a fair bit of that's played out really in terms of their own market, but the fear is more their own economy," said Matthew Goodson, managing director at Salt Funds Management. "At the same time we're seeing the US market start to focus on the possibility of a September rate hike, which appears to be a fifty-fifty call at the moment."
"We've seen a decent step up in volatility. That alone appears to have triggered a degree of selling. There's been a lot of money in New Zealand chasing high yields and perhaps some of that money is returning to whence it came," Goodson said.
Sky TV declined 3.2 per cent to $4.58, in what Goodson described as "an extraordinary sell-off" after it reported a mixed result on August 21, with profit rising 6.4 per cent on falling subscriber numbers as new digital platforms eat into its traditional dominance of the pay television market. Sky TV shares went ex-dividend earlier this week, explaining some of a 7.5 per cent fall for the week.
"It's continuing an extraordinary sell off. It was over $6 just several weeks ago," Goodson said. "The result largely met expectations but what was concerning was the absence of subscriber growth. We're certainly seeing overseas a lot of cord cutting."
Z Energy rose 0.2 per cent to $5.85. The service station chain warned it may face millions of dollars of additional costs as the Customs Service seeks to claw back excise duties stretching over the past three decades on leftover fuel in a pipeline from the Whangarei refinery.
Outside the benchmark index, Pumpkin Patch rose 1.4 per cent to 14.2c after it announced it has appointed Dave Foster as its chief financial officer.
Evolve Education Group fell 4.3 per cent to 90c, which listed in December, affirmed its prospectus guidance at its annual meeting. On the New Zealand Alternative Index, Pushpay Holdings rose 0.9 per cent to $5.45.