a2 Milk gained 15c or 2.09 per cent to $7.34 – its highest level for nearly 14 months. Photo / NZME
The New Zealand sharemarket had a muted reaction to falling inflation in the United States – and instead looked to be settling into holiday mode.
The S&P/NZX 50 Index traded flat for most of the day, finishing down 16.41 points or 0.14 per cent at 11,585. It traded within the range of 11,616.7 and 11,553.52 points.
There were 56 gainers and 69 decliners over the whole market on volume of 67.46 million share transactions worth $170.24 million.
The trading was boosted by higher-than-normal trading in rural services firm PGG Wrightson, up 1c to $4.20, with 8.53 million shares worth $37.12m changing hands.
Greg Smith, head of retail with Devon Funds Management, said “we didn’t see follow-through from the strength of the US markets following a lighter-than-expected consumer price index (CPI).
“It looks like our market is in wind-down mode as we head into Christmas. We will get lower volumes and retail investors may facilitate a rally that we normally get at this time of the year,” he said.
The US November CPI increased 0.1 per cent, and not the expected 0.3 per cent, dragging annual inflation down to 7.1 per cent, from 7.8 per cent. Economists were predicting headline inflation at 7.3 per cent. It was the smallest monthly increase in more than a year.
Core inflation, excluding food and energy prices, is running at 6 per cent, slightly less than the expected 6.1 per cent.
Smith said the latest CPI sets up a moderation in interest rate hikes by the Federal Reserve. “We haven’t seen an easing in our inflation, with food prices being robust. The Reserve Bank has displayed a more hawkish attitude.
“If the Fed comes out with a dovish outlook, then it will be hard not to see other central banks following.”
The NZ dollar strengthened against the American greenback to US64.43c and was steady against the Australian. The S&P/ASX 200 Index was up 0.57 per cent to 7244 points at 6pm.
Global marketer a2 Milk continued its strong run, gaining 15c or 2.09 per cent to $7.34 – its highest level for nearly 14 months. Synlait Milk was up 4c to $3.72.
Smith said a2 Milk was continuing to find support, as is Synlait, and they will benefit from the China re-opening as the country pivots away from its Covid-zero policy.
Leading stocks were mixed. Fisher and Paykel Healthcare was down 28c to $22.22, and Skellerup Holdings decreased 7c to $5.23. Mainfreight was up $1 to $69; Ebos Group gained 63c to $42.93; and Chorus increased 7.5c to $8.38.
Retirement village stocks Ryman Healthcare gained 10c to $6.20, and Oceania Healthcare was down 2c or 2.47 per cent to 79c.
Vulcan Steel continued to bounce around, down 33c or 3.75 per cent to $8.47. Accordant Group fell 10c or 5.56 per cent to $1.70; CDL Investments declined 2.5c or 3.31 to 73c; Delegat Group decreased 20c or 1.96 per cent to $10; and Tourism Holdings was down 5c to $3.55.
Auckland International Airport, down 6c to $8.09, reported that total passenger volumes in October were 72 per cent of pre-Covid levels and in November 74 per cent.
Contact Energy, down 6c to $7.71, told the market that mass electricity and gas sales in November were 285GWh, down from 299GWh for the same month last year. Contracted wholesale electricity sales brought the total to 563GWh, down from 655GWh.
Apple exporter Scales Corp, which had a slight earnings downgrade, fell 31c or 7.11 per cent to $4.05.
Pacific Edge decreased 2c or 4.04 per cent to 47.5c; Just Life Group was down 3c or 6.25 per cent to 45c; Eroad declined 4c or 3.6 per cent to $1.07; Bremworth shed 2c or 4.26 per cent to 45c; and Embark Education was down 2c or 3.33 per cent to 58c.
Property companies Vital Healthcare Trust decreased 4c or 1.71 per cent to $2.30; Kiwi Property declined 2c or 2.13 per cent to 92c, and Goodman Trust was down 3c to $2.01.
Gentrack, which had an earnings upgrade, increased 9c or 3.69 per cent to $2.53; Move Logistics collected 5c or 4.85 per cent to $1.08; and Blackpearl Group rebounded 6c or 15.79 to 44c.
Pushpay’s takeover bid by the Sixth Street and BGH Capital consortium for $1.34 a share is proceeding to a shareholders’ meeting in March after the scheme of arrangement satisfied US anti-trust conditions.
Sixth Street and BGH Capital presently hold 20.34 per cent of Seattle-based Pushpay. Its share price was down 1c to $1.28.
Channel Infrastructure, declining 2c to $1.42, told the market that Rob Buchanan will take over from Naomi James as chief executive in early March – though he will join the company at the end of January.