New Zealand shares followed Australia lower as stronger than expected jobs figures across the Tasman halted the brief optimism that the Reserve Bank of Australia might cut its key interest rate earlier than expected.
New Zealand’s S&P/NZX 50 index was already shaky through early trading after economic indicators firmed up expectations for September quarter gross domestic product figures to come in weak next week.
The local benchmark took a step lower after Australia’s Bureau of Statistics released data showing unemployment at an eight-month low in November, prompting traders to dial back the outside chance some had seen of a rate cut as early as February. Australia's S&P/ASX 200 was down 0.3% in late trading.
The NZX50 fell 68.47 points, or 0.5% to 12,692.72, led lower by Mercury NZ as the generator-retailer dropped 3% to $6.09.
Meridian Energy declined 1.6% to $5.58 on a heavier volume than usual of 2.3 million shares after announcing chief executive Neal Barclay’s departure in June next year, when he’ll be replaced by chief financial officer Mike Roan.
Contact Energy rose 1.9% to $8.81 and Manawa Energy gained 2.7% to $5.64. Contact is hoping to buy Manawa to expand its generation footprint, with a decision by the Commerce Commission due on Christmas eve, having been delayed.
Property investors – which are typically sensitive to interest rates – were among the more heavily traded stocks on the day. Kiwi Property was unchanged at 90 cents with 1.5 million shares changing hands, as was Precinct Properties NZ at $1.23 on a volume of 1.4 million, while Argosy Property slipped 0.5% to $1.025 on a volume of 1.1 million and Vital Healthcare Property Trust rose 1.1% to $1.84 with 985,000 shares changing hands.
Spark New Zealand rallied on news that it’s sold its minority stake in the Connexa mobile towers business for $314 million to Canada’s Caisse de dépôt et placement du Québec, better known as CDPQ. The shares rose 2.1% to $2.86 on a volume of almost 4.1 million.
Turners Automotive Group rose 5.4% to $5.62, posting the biggest gain on the day.
Retailers were generally stronger despite Statistics New Zealand figures showing flat spending on credit and debit cards in November. Payments company Smartpay rose 4.6% to 68 cents, KMD Brands advanced 2.5% to $1.95, Briscoe Group gained 2.1% to $5.35, and Michael Hill International increased 1.6% to 64 cents. Warehouse Group was unchanged at $1.03, as was Hallenstein Glasson at $7.64.
Channel Infrastructure rose 1.7% to $1.85 when they resumed trading from yesterday’s halt to complete the retail bookbuild component of its renounceable $50 million capital raising. The shares were sold at a 20 cent premium to the offer price of $1.60, meaning those investors who didn’t take up their rights will receive the premium.
The kiwi dollar rallied with its antipodean partner, rising to 58.07 US cents at 5pm in Auckland from 57.85 cents at 7am, and dipped against the Aussie to 90.49 Australian cents from 90.87 cents.
Reporting by Paul McBeth. Image from Curious News.
