New Zealand’s shares limped into positive territory with a late pull from across the Tasman, as cooler Australian inflation reignited optimism for an early rate cut by the Reserve Bank of Australia.
The S&P/NZX 50 index increased 1.05 points, or 0.01%, to 13,043.11, spending much of the trading day in red territory after stronger than expected US economic data had analysts rethinking the Federal Reserve’s interest rate track.
The yield on 10-year New Zealand government bonds rose 8 basis points to 4.56% at 5pm in Auckland, while 10-year swaps increased 7 basis points to 4.10% and two-years were up a more modest 1 point at 3.43%.
Still, that didn’t feed into currency markets with the kiwi trading at 56.33 US cents at 5pm from 56.45 cents at 8am, down from 56.61 cents yesterday. It traded at 90.40 Australian cents from 90.43 cents yesterday.
Australia’s big four banks rallied after Bureau of Statistics figures showed core inflation slowed to 3.2% in November from 3.5% in October.
Bank on it
Dual-listed Westpac Banking Corp rose 3% to $37.15 on the NZX, while ANZ Group Holdings was up 3% at $32.79. Heartland Group Holdings, which bought Australia’s Challenger Bank last year, fell 1% to $1.01.
Local firms with trans-Tasman operations were also broadly stronger. Fletcher Building rose 2.5% to $2.87, Ryman Healthcare advanced 1.7% to $4.73, Mainfreight increased 0.8% to $72.60 and SkyCity Entertainment Group advanced 0.7% to $1.43.
Mercury NZ led the benchmark index higher, up 4.2% at $5.96, with investors anticipating it will be replaced in the MSCI standard index by Contact Energy, which slipped 0.5% to $9.65.
Lines company Vector was also stronger, up 3.1% at $4.04, its highest close since Aug 31, and Meridian Energy advanced 1.9% to $5.93.
KMD Brands posted the steepest decline on the NZX50, falling 5.7% to 41.5 cents, while Gentrack dropped 3.1% to $12.30 and Auckland International Airport slid 3% to $8.53.
Spark New Zealand was the most heavily traded stock on a volume of 3.2 million, ending the day unchanged at $2.90.
Turners Automotive Group fell 2.9% to $5.40 after industry figures showed the lowest number of annual car registrations in 11 years. Colonial Motor Cor increased 2% to $6.53.
Reporting by Paul McBeth. Image from Curious News.
