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NZX trading activity lifts while new listings fail to emerge in December

Friday 5th January 2018

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New Zealand share trading continue to surge in December but new equity capital raisings were still missing in action as the NZX struggles to attract new companies to the market. 

Total equity trades jumped 45.5 percent to 171,731 in December from the same month a year ago and the total value of trades lifted 1.9 percent to $2.9 billion, NZX said. On the NZDX market for debt securities, however, total trades fell 26.2 percent to 2,617 while the value slipped 5.1 percent to $132 million.

The S&P/NZX 50 Index climbed 22 percent from the previous December, fueled by prolonged low interest rates, which have limited returns from debt securities and bank deposits. Milk marketer a2 was the top performer on the benchmark index for 2017, soaring around 279 percent as earnings upgrades coincided with increasing Chinese demand. 

NZX's monthly data again showed the dearth of new companies coming to market. Total equity securities fell 6.5 percent to 159 while listed debt securities rose 5.6 percent to 113. There were no initial public offerings or compliance listings last month and year-to-date $480 million has been raised. NZX saw just one initial public offering last year in Oceania Healthcare, and that pipeline has come under scrutiny from fund managers with the high profile departure of Xero, which is shifting to a sole listing on the ASX.  

In December, $28 million of debt securities were sold, bringing the total to $3.23 billion for the 2017 year.

Secondary capital raisings were $756 million in the month and $4.38 billion for the year.

The market capitalisation of all equity securities rose 17 percent year-on-year to $135.2 billion, equivalent to 50 percent of gross domestic product. The value of debt securities gained 2.7 percent to $26.4 billion, or 9.7 percent of GDP.

In its derivatives market, the total of futures lots traded jumped 29.2 percent to 24,500 in December from a year earlier, while total lots of options fell 66.7 percent to 1,800. Open interest was up 4.2 percent to 52,163. 

In its SuperLife business, KiwiSaver funds under management rose 25.1 percent to $749 million, while other funds gained 17.8 percent to $1.3 billion, bringing the total FUM to $2 billion. In Smartshares, the total rose 25 percent to $2.1 billion as units on issue climbed 12.9 percent to $875 million.

NZX wealth technologies FUM fell 9.6 percent to $1.17 billion.

In NZX's Agri division, subscriptions to NZ agri data products rose 27.9 percent to 3,122 while Australian data product subscriptions fell 3.1 percent to 1,514. Total paid advertising page equivalents for its Farmers Weekly title rose 44.6 percent to 68 in December versus the same month a year earlier. While year-to-date they fell 28.7 percent to 1,382.

The shares last traded at $1.12, unchanged so far this year. 


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