NZX 50 gains for a second week as rising tourism revives SkyCity

New Zealand’s S&P/NZX 50 index rose for a second week as recovering tourism numbers buoyed the outlook for SkyCity Entertainment Group, while lenders Heartland Group Holdings and ANZ Group Holdings fared better than their larger Australian peers amid a cooling property market across the Tasman.

Auckland International Airport underpinned a late rally on Friday to drag the NZX 50 into positive territory to end the week, while the electricity generator-retailers were mixed after Contact Energy and Meridian Energy’s latest monthly update showed the South Island hydro schemes remained full.

Software companies Gentrack, Serko and Vista Group International were at the top of the leaderboard on Friday, joining a tech rally across Asia after Salesforce led Wall Street’s Dow Jones Industrial Average higher overnight.

And investment bank Jarden will have its first face-off with its departing senior staffers next week, with an Employment Court hearing scheduled in Auckland on Tuesday.

A late turn

The NZX 50 gained 29.08 points, or 0.2%, to 13,854.38 on Friday, with 29 stocks gaining, 13 declining, and eight unchanged. That took the weekly gain to 0.2%.

SkyCity posted the biggest weekly gain, up 3.3% after rallying on Friday as Statistics New Zealand figures showed international tourists were still arriving despite the geopolitical ructions, with Australian and Chinese visitors accounting for 70% of the uplift.

Meanwhile, Heartland and ANZ were both up 2.9% on the week, defying Australia’s cooling property market as shrinking mortgage applications across the Tasman saw a 6.2% slump for Westpac Banking Corp. Vulcan Steel posted the biggest weekly decline on the NZX 50 as it fell 8%, more than unwinding the prior week’s gain.

The S&P/NZX 20 index futures contract for September rose 0.2% to 7,745, with 50 lots traded for a value of $387,000 on Friday, with the NZX 20 up 0.1% at 7,802.15.

Turnover across the main board was $98 million, with Auckland Airport accounting for $12.8 million as it rose 0.9% to $8.79.

Stock markets across Asia were mixed, with South Korea’s Kospi up 1.5% in late trading and Japan’s Nikkei 225 index advancing 0.4% amid ongoing demand for the AI trade with Bloomberg reporting OpenAI was on track to generate annualised revenue of US$40 billion ahead of its planned IPO, behind Anthropic’s reported US$47 billion run rate.

Australia’s S&P/ASX 200 index dropped 1% in late trading as softer metal prices weighed on miners such as BHP and Rio Tinto, while Commonwealth Bank of Australia extended its decline amid a cooling property market across the Tasman.

Tech stocks were buoyed by tamer US producer and consumer price inflation dialling back bets that the Federal Reserve would need to hike the federal funds rate next month, although US 30-year government bond yields remained elevated.

“The bond market is trying to say one thing and equity markets are trying to say something else, but earnings are keeping them honest,” said Peter McIntyre, an investment adviser at Craigs Investment Partners.

Gentrack posted the biggest gain on the NZX 50 on Friday, up 4.1% at $3.85, while Serko gained 1.5% to $1.65 and Vista advanced 1.5% to $2.69. Across the Tasman, Xero climbed 5.5% to A$81.42 in late trading, while WiseTech Global was up 4.8% at A$43.07.

Rain in places

Power companies were mixed after Contact and Meridian’s monthly operating updates showed national hydro storage eased in July, with the South Island dams more than making up for North Island schemes below their historical levels. Contact nudged up 0.3% to $9.16, while Meridian increased 0.5% to $5.55, and Mercury – which reports next week – dropped 0.8% to $6.50. Genesis Energy climbed 2.3% to $2.66.

The a2 Milk Co fell 1.4% to $6.99 ahead of reporting its annual result on Monday, with the milk marketing firm expected to report a modest lift in earnings as supply chain issues get back to normal. Synlait Milk slipped 2.6% to 37 cents, while Fonterra Shareholders’ Fund units declined 1.4% to $6.99.

Ebos Group posted the biggest decline on the day, down 2.8% at $21.23, while Summerset Group Holdings slipped 2.3% to $7.97.

Outside the benchmark index, Rua Gold was unchanged at $1.555 after the would-be gold miner reported a doubling of its cash burn in the six months ended June 30 as it ramped up exploration and permitting work on its Reefton project, with the net loss widening to C$13.4 million.

Colonial Motor Co jumped 9.2% to $7.10 on relatively light volumes after the dealership reported a 4.7% lift in annual trading profit and hiked its dividend, even after getting wrong-footed by the energy shock and growing demand for electric vehicles.

Turners Automotive Group increased 0.2% to $8.11, while 2 Cheap Cars was unchanged at 82 cents – still above the 80 cents per share takeover offer – after saying July trading softened, with a monthly net profit of $320,000.

Green Cross Health was unchanged at $1.95 after saying chief executive Rachael Newfield would leave the company in January, having completed the sale of the medical division to Tend Health.

The kiwi dollar rose to 58.66 US cents at 5pm in Auckland from 58.32 cents yesterday after the BusinessNZ-BNZ performance of manufacturing index showed industrial activity continued to expand last month, albeit at a slower pace.

And the Employment Court’s calendar showed Judge Kathryn Beck would hear an application for deliver up orders brought by Jarden Management against Reynolds and others on Tuesday in Auckland. Deliver up orders typically require a former employee to return documents, devices or confidential information to the other party.

Jarden will be represented by Brian Dickie KC, while the former staff have retained Philip Skelton KC.

Reporting by Paul McBeth. Image from Curious News.