Tuesday 23rd April 2019
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The S&P/NZX 50 Index broke through the 10,000 level for the first time today, and has climbed about 284 during the past 10 years.
The benchmark index rose as high as 10,036, and ended the day up 45.22 points, or 0.5 percent, at 10,004.84. Within the index, 24 stocks rose, 22 fell, and four were unchanged. Turnover was light at $76.4 million.
The NZX50 has had a couple of attempts at hitting the 10,000 level in the past month, with global equity markets buoyed as low interest rates provide cheap finance to corporates and make returns on bonds less attractive than stocks. It took five years to double from the 5,000 level, having taken five years to reach that mark from 2,500 in the fallout of the global financial crisis.
NZX chief executive Mark Peterson said it was a great milestone for the market and compared well with its global peers.
"It represents the significant growth we have seen in the New Zealand market over the past 10 years, with the S&P/NZX 50 up more than 280 percent over that period," he said.
NZX fell 1 percent to $1.
"It's a nice achievement, isn't it. Growth companies got us towards it, and defensive stocks helped us get above the level," said Rickey Ward, head of NZ equities at JBWere.
"Maybe it's going to be value companies, like Fletcher Building, that haven't performed over the last two or three years that help lift it further," he said. Fletcher increased 0.2 percent to $5.19.
Restaurant Brands New Zealand led the market higher, up 4 percent at $8.38 on a volume of 100,000 shares. The fast-food operator was one of several companies to be sold off last week when it dropped its dividend payment and reported softer earnings than expected.
Tourism Holdings, Mercury NZ and Genesis Energy were others that warned of lower earnings and were also sold off last week. Today, Tourism Holdings rose 1 percent to $4.25, Mercury was unchanged at $3.85 and Genesis increased 0.7 percent to $3.08.
Exporters were among the day's gainers, with F&P Healthcare up 3.1 percent at $15.63 and A2 Milk rising 2.4 percent to $16.08. The kiwi dollar dropped below 67 US cents, which boosts the value of export receipts when converted back into local currency. Scales Corp rose 0.4 percent to $5.03 and Sanford increased 0.3 percent to $6.87.
Grant Williamson, a director at Hamilton Hindin Greene, said yield stocks have been a favourite among investors, but that there was also an appetite for growth companies, such as A2 and F&P Healthcare.
"The market continues to surprise a fair number of people at how well it's performed."
Spark New Zealand was the most traded stock, with a volume of just 1.4 million shares changing hands as the holiday-shortened week kept the market relatively quiet. Spark rose 1.2 percent to $3.745.
Just two other stocks in the index traded on volumes of more than a million shares, with Meridian Energy down 1 percent at $4.04 and Contact Energy falling 0.7 percent to $6.77.
Summerset Group posted the biggest fall on the day, down 2.5 percent at $5.85, followed by Ryman Healthcare, down 2.4 percent at $12.05.
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