MARKET CLOSE: NZ shares gain as US earnings buoy confidence; A2, F&P gain

Tuesday 16th April 2019

New Zealand shares followed Wall Street higher as better than expected US company earnings buoyed investor confidence. Local growth stocks, including A2 Milk and Fisher & Paykel Healthcare, gained.

The S&P/NZX 50 Index rose 78.02 points, or 0.8 percent, to 9,846.35. Within the index, 29 stocks gained, 13 fell and eight were unchanged. Turnover was $129 million.

Wall Street set a positive tone for Asia, with the S&P500 up 0.7 percent on Friday after a strong earnings report from JP Morgan, where chief executive Jamie Dimon talked up the economic outlook for the US. Disney's new streaming service plans and Chevron's US$33 billion takeover of Anadarko Petroleum bolstered investor confidence.

Stocks across Asia were mostly positive, with China's Shanghai Composite Index up 1.1 percent in afternoon trading, South Korea's Kospi 200 Index gaining 0.4 percent and Australia's S&P/ASX 200 index down 0.1 percent.

"With this lack of local news, we're being driven by what's happening in the US reporting season and we saw good numbers from JP Morgan and Disney," said Peter McIntyre, an investment adviser at Craigs Investment Partners.

A2 Milk led the local market higher, up 4.2 percent at a record $15.23 on a volume of 721,000 shares, just shy of its 868,000 three-monthly average. Synlait Milk, which supplies A2, rose 2.9 percent to $10.70 on a smaller than usual volume of 44,000 shares.

Fisher & Paykel Healthcare was the most active stock on a volume of 2.2 million shares - more than three-times its 90-day average of 660,000.

McIntyre said the low interest rate environment and potential for a rate cut could add more support for F&P Healthcare if it leads to a weaker currency, given the breathing mask maker is an exporter.

Sky Network Television rose 1.6 percent to $1.25. One of its flagship programmes, 'Game of Thrones' kicked off its final season today.

Spark New Zealand fell 0.6 percent to $3.615 on a volume of 2.1 million shares, less than half its 90-day average. SkyCity Entertainment was up 0.3 percent at $4 on a volume of 1.8 million shares, more than twice its 686,000 average.

Infratil extended recent gains, up 2.1 percent at $4.39 on a volume of 555,000 shares, more than its 424,000 average.

Auckland International Airport increased 0.3 percent to $7.99 on a volume of 1.1 million shares. Queenstown Airport, of which Auckland Airport owns a quarter, projected a 13 percent increase in winter capacity due to extra flights from Qantas and Jetstar. Air New Zealand rose 1.5 percent to $2.78 on a volume of 616,000 shares, almost half its 90-day average.

Fletcher Building was the only other company in the benchmark index to trade on a volume of more than a million shares. It fell 0.8 percent to $4.96. The government and building sector yesterday signed an accord in a bid to change commercial behaviour that has led to the high-profile collapse of several firms.

Heartland Group Holdings reported the biggest fall, down 4.2 percent at $1.58 on a volume of 343,000 shares, down on its 397,000 average.

Metlifecare fell 1.3 percent to $4.63 and Kathmandu Holdings decreased 0.9 percent to $2.25.

Outside the benchmark index, PGG Wrightson rose 1 percent to 50 cents after announcing a boardroom reshuffle, with David Cushing taking a directorship after lifting his stake via H&G. Rodger Finlay will take over the chair at the end of the month.

NZME was unchanged at 55 cents, on a bigger than usual volume of 2.7 million shares.

McIntyre said NZME has seen two large trades made in the past two sessions, although there haven't been any substantial shareholder notices lodged yet.

(BusinessDesk)

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