New Zealand shares rose, led by Westpac Banking Corp, as dual-listed stocks rebounded from a sharp drop yesterday. Australia and New Zealand Banking Group and Spark New Zealand gained.
The S&P/NZX 50 Index rose 5.98 points, or 0.1 percent, to 5613.29, somewhat reversing yesterday’s biggest drop in four years. Within the index, 15 stocks rose, 28 fell and seven were unchanged. Turnover was $260 million.
Some Asian markets have clawed back after yesterday’s 8.5 slump on the Shanghai Composite Index triggered a global sell off amid fears Chinese economic growth was faltering. Australia’s S&P/ASX 200 Index gained 2.4 percent in afternoon trading, after slumping 4 percent yesterday, Hong Kong’s Hang Seng rose 1.6 percent, while Japan’s Nikkei 225 Index slipped 0.3 percent, less than yesterday’s 2.8 percent decline.
Dual-listed stocks rose. Westpac led the benchmark index higher up 4.6 percent to $34.20. ANZ climbed 3.6 percent to $31. Spark, formerly Telecom Corp, advanced 2.8 percent to $3.12. Ebos Group, the animal and healthcare firm, rose 2.9 percent to $10.50. SkyCity Entertainment Group, the casino operator, increased 2.3 percent to $3.99. Trade Me Group, the online auction site, rose 2.3 percent to $3.99.
“There’s been a bit of rebound with some of the markets around the world, Australia and so forth,” said Mark Lister, head of private wealth research for Craigs Investment Partners. “Our market help up better than others – to put that in perspective, the New Zealand market fell about 8 percent from its highest point to its lowest point whereas the US market fell probably 11 or 12 percent from highest to lowest, and in Australia that was 17 or 18 percent. Our market was much more resilient when things were falling down around us, therefore the is no real rebound because we didn’t fall as much in the first place.
“For the time being it looks like the steep declines are behind us and we might get a bit of a bounce – the million dollar question is will that bounce be sustained or will we get another bout of weakness emerge later in the week?” Lister said.
On the local market earnings season continued, Genesis Energy rose 0.6 percent to $1.75 after it became the latest electricity company to increase its distributions to shareholders while it reported a 113 percent increase in net profit of $104.8 million on marginally increased revenues of $2.1 billion in the year to June 30.
Steel & Tube Holdings fell 0.4 percent to $2.67. New Zealand’s biggest steel distribution company has continued its drive to grow through acquisitions, buying Aquaduct NZ out of receivership for about $8 million cash.
Air New Zealand fell 0.8 percent to $2.65. The airline has had its alliance with Hong Kong-based Cathay Pacific on the Auckland-Hong route has been extended for another four years after the national airline got sign-off from Transport Minister Simon Bridges.
Outside the benchmark index, SLI Systems surged 14 percent to 80 cents. The online retail search engine developer widened its annual loss to $7.1 million while sales met the reduced guidance it gave in April, of $28.1 million. The company said it was on the road to becoming breakeven on a cash-flow basis and wouldn’t need to raise any more capital to fund its growth.
“The real positive out of that was they believe that they’re almost past the hump where they’ve got enough capital to meet their growth targets,” James Smalley, director at Hamilton Hindin Greene said in explaining today’s share-price jump. “There’s no signs of a capital raising or anything like that, and that would obviously weigh on a share price.”
Wynyard Group, the intelligence software developer, dropped 3.1 percent to $1.27 after it widened its first-half loss to $17.6 million while boosting sales 39 percent and anticipates faster revenue growth from the second half as it rolls out a new product.
Smiths City fell 2 percent to 50 cents. The retailer, which is selling its flagship Colombo St store in Christchurch to repay debt, said sales fell in the first four months of the year after it shuttered unprofitable outlets and spending dipped in rural areas.