The S&P/NZX 50 index fell 1.3% this week as investors’ confidence in the prospect of cheaper finance costs wavered, with government bond yields pushing higher and the greenback remaining in the ascendency.
New Zealand’s benchmark stock index declined for a second day, down 47.76 points, or 0.4%, at 12,895.98 in relatively light trading with just Spark New Zealand, Contact Energy trading on volumes of more than a million shares.
Share markets were closed on Wall Street on Thursday to commemorate the death of former president Jimmy Carter.
Meanwhile, investors have fretted over the pathway to lower interest rates as economic data points to the US economy being in relatively good heart, while the prospect of incoming President Donald Trump’s new tariff regime is seen as stoking inflation and slowing future rate cuts.
The yield on New Zealand 10-year government bonds rose 1 basis point to 4.55% at 5pm in Auckland, while the kiwi dollar remained subdued, trading at 55.94 US cents from 55.97 cents yesterday.
Across the Tasman, ANZ economists joined Macquarie Bank in bringing forward their rate cut expectations for the Reserve Bank of Australia to February. The kiwi traded at 90.27 Australian cents from 90.29 cents yesterday.
Tired markets
Stock markets were generally subdued across Asia ahead of US non-farm payrolls figures, with Australia’s S&P/ASX 200 index down 0.5% in late trading, while Japan’s Nikkei fell 1% and Singapore’s Straits Times index was down 1.7%.
Dual-listed lender Westpac Banking Corp led New Zealand’s NZX50 lower, falling 2.1% to $36.06 after Morgan Stanley analysts downgraded the stock to underweight. Meanwhile, ANZ Group Holdings was upgraded to equal weight, and gained 0.6% to $32.20.
Blue-chip stocks were generally weaker, with Fletcher Building falling 1.8% to $2.78, Spark New Zealand down 1.7% at $2.88, Ebos Group declining 1.6% to $36.45, and Infratil slipping 1.5% to $11.85.
Energy companies were broadly down, as Contact slipped 0.2% to $9.50, Mercury fell 0.2% to $5.89 and Meridian Energy was down 0.4% at $5.875.
KMD Brands posted the biggest gain on the benchmark index, up 4.8% at 44 cents, while Skellerup Holdings gained 2% to $5.15 and Kiwi Property Group advanced 1.7% to 92.5 cents.
Trading of Pacific Edge shares was halted until Monday to give the bladder cancer diagnostics tool maker time to digest another knock back in securing US health administrator Medicare coverage.
Reporting by Paul McBeth. Image from Curious News.
