Mainfreight drives NZX 50 to new record on stronger earnings

New Zealand’s S&P/NZX 50 index rose to a new record as Mainfreight led the charge after the logistics group bounced back from a tough period a year earlier in heavier trading than usual amid the semi-regular tweaking of the MSCI equity indices tracked by some institutional investors.

Stocks across Asia were mixed as investors await the outcome of an Nvidia board meeting, where the future of chief executive Jensen Huang reportedly hangs in the balance.

Fonterra Shareholders’ Fund units dipped, while the farmer-owned shares tumbled after the dairy exporter said it would require a more orderly sale of shares by farmers once they stopped supplying the cooperative.

And across the Tasman, Xero surged after announcing a A$1 billion share buyback and lifting earnings guidance.

Moving on up

The NZX 50 rose 79.37 points, or 0.6%, to 14,259.23, with 35 stocks gaining, seven declining and eight unchanged. The S&P/NZX 20 index futures contract for December increased 0.5% to 7,842, with 30 lots traded for a value of $235,000, while the NZX 20 advanced 0.5% to 7,844.03.

Turnover across the main board was $178.5 million, of which Fisher & Paykel Healthcare accounted for $30.5 million as the country’s biggest listed company increased 0.1% to $48.48.

Mainfreight jumped 5.9% to $70.45 with $27 million of stock changing hands in its heaviest trading day since September last year. The logistics group beat analysts’ expectations, with a 66% increase in first-half profit and a 20% gain in revenue.

Stocks across Asia were mixed amid reports that Nvidia’s board was preparing to remove chief executive Jensen Huang after the New York Times reported he had an affair with a direct report at work. Polymarket bets priced an 88% chance of Huang stepping down by the end of the year, up from 17% earlier today.

South Korea’s Kospi rose 0.4% and Japan’s Nikkei 225 increased 0.2%, while Hong Kong’s Hang Seng fell 0.9% and Australia’s S&P/ASX 200 index dipped 0.2% in late trading.

Retailers were stronger after mixed Statistics New Zealand data, with spending on credit and debit cards slipping 0.7% in October as petrol bills continued to crowd out other goods, while travel data showed Chinese tourists continued to underpin short-term visitors in September.

KMD Brands posted the biggest gain on the NZX 50, up 10% at $2.47, while Hallenstein Glasson Holdings rose 0.6% to $14.33 and Briscoe Group increased 0.2% to $4.30.

“A drop in oil prices since the start of November has provided some relief for fuel prices at the pump, although they remain high,” Westpac NZ senior economist Michael Gordon said in a note. “We anticipate that growth in consumer spending volumes will remain subdued in the near term, with regional variations dependent on exposure to the well-performing export sector.”

Travel and tourism firms were also stronger, with Tourism Holdings up 1.8% at $2.90, while SkyCity Entertainment Group gained 1.4% to 71.5 cents, Air New Zealand increased 1.3% to 38.5 cents and Auckland International Airport nudged up 0.1% to $9.01.

Currency effect

Nick Brunsdon, an economist at Infometrics, said the continued softness of the kiwi dollar likely supported growth in tourist numbers.

“However, high jet fuel prices continue to challenge airlines, and could slow growth in visitor arrivals, especially for long-haul markets,” Brunsdon said in a note.

The kiwi dollar fell to 55.57 US cents at 5pm in Auckland from 56.06 cents yesterday and declined to 81.17 Australian cents from 81.51 cents.

Heartland Group Holdings rose 0.8% to $1.26 after the financial services firm said its proposed merger with TSB Bank was taking longer due to the Reserve Bank probe, and was expected to be completed by March next year.

Spark New Zealand rose 1.4% to $2.16 after the telecommunications group noted activist investor Tommy Scrivener’s observations about how it accounted for the gain on the sale of its data centre stake, and said there wasn’t a material impact on the firm’s financial statements.

Fonterra Shareholders’ Fund units dipped 0.1% to $9.25, while the cooperative shares sank 6% to $5.45 after the dairy exporter told shareholders at today’s annual meeting that it would introduce a more defined sale timetable for farmers who stopped supplying the cooperative.

Oceania Healthcare posted the steepest fall on the NZX 50, down 3.1% at 63 cents, while Meridian Energy slipped 2% to $5.82, and Serko declined 1.6% to $1.20 after the Wall Street Journal reported United Airlines would ban artificial intelligence agents from booking flights.

Across the Tasman, Xero jumped 7.7% to A$76.34 in late trading after the accounting software developer announced plans to buy A$1 billion of stock on market, with the current share price seen as below the firm’s long-term value. Xero reported a 46% gain in revenue from the Melio acquisition, while adjusted earnings increased 3%. Free cash flow shrank 26% in the half. It forecast annual revenue to grow by as much as 27%.

Reporting by Paul McBeth. Image from Curious News.