NZX 50 touches 14k level for first time as F&P Healthcare drives gains

New Zealand’s S&P/NZX 50 index climbed above 14,000 for the first time in the trading day before easing back from the new record, as Fisher & Paykel Healthcare again drove gains on the local benchmark, with support from Ebos Group and Auckland International Airport.

Travel software firm Serko led the local benchmark higher after saying the Middle East conflict had a minimal impact on its operations in the June quarter.

Asian stock markets were mixed as Australia rallied after a strong result from miner Rio Tinto and as tame inflation tempered expectations for another rate hike by the Reserve Bank of Australia, while South Korea’s Kospi tumbled as SK Hynix’s soaring profit failed to meet the hype, with investors unnerved by its capital spending programme.

And oil prices were on the rise as Iran launched a surprise missile attack on US forces in the Middle East, while locally, Australia’s EnZed Energy was awarded the first offshore petroleum exploration permit since the coalition government lifted its predecessor’s ban.

A new level

The NZX 50 rose as high as 14,000.35 in local trading, ending the day up 114.74 points, or 0.8%, at 13,976.67, with 28 stocks gaining, 17 declining, and five unchanged. The S&P/NZX 20 index futures contract for September climbed 0.9% to 7,857, with 525 lots traded for a value of $4.1 million, while the NZX 20 advanced 0.9% to 7,903.48.

Turnover across the main board was $118.5 million, of which Contact Energy accounted for $21.3 million as it fell 2% to $9.05.

F&P Healthcare was the biggest tailwind for the bourse, up 2.5% at $41.75, while Ebos climbed 4.6% to $22.61 and Auckland Airport advanced 0.9% to $8.92.

“Fisher & Paykel Healthcare is a heavy weighting in the index and it’s up over 2% today – it’s had a strong month and, on a rolling-month basis, it’s up over 6%,” said Peter McIntyre, investment adviser at Craigs Investment Partners.

Markets across Asia were mixed as Australia’s S&P/ASX 200 index rose 1.1% in late trading as Rio Tinto reported a 43% jump in quarterly earnings and as tamer inflation than forecast cooled expectations for the RBA to hike its target cash rate.

Bevan Graham, an economist at Salt Funds Management, said it was too early to rule out further hikes in Australia, but the inflation data supported his view for a hawkish hold at the August meeting.

“Today’s result probably came with a (small) sigh of relief, printing below expectations and with a softening of important services components,” Graham said in a note.

Meanwhile, South Korea’s Kospi tumbled 8.7% in late trading after SK Hynix disappointed hyped earnings expectations, even as its quarterly profit surged six-fold, with investors more focused on the US$31 billion of capital spending pencilled in for this year.

Still to come

Craigs’ McIntyre said the US Federal Reserve decision and earnings from Meta Platforms and Microsoft would hang over markets, although he expected the Fed to hold off from hiking until its September meeting to better-gauge the inflation impact of the Middle East conflict.

Brent crude oil futures for the front month climbed 3.8% to US$87.29 a barrel after reports that Iran launched a surprise attack on US forces in the Middle East and rejected an Omani plan for re-opening the Strait of Hormuz. The kiwi dollar traded at 57.87 US cents at 5pm from 57.67 cents yesterday.

Serko led the NZX 50 higher, jumping 5.3% to $1.38 after saying the Middle East conflict’s impact on the software firm’s business had been minimal, while affirming annual guidance.

Among other gainers on the day, KMD Brands rose 3.5% to $1.775, Vulcan Steel advanced 2.8% to $6.60 and Chorus increased 2.5% to $9.78.

Briscoe Group posted the steepest decline on the day, falling 4.8% to $4.52, while dual-listed Westpac Banking Corp fell 2.4% to $44.59 and Sky Network Television slid 2.1% to $3.23.

SkyCity Entertainment Group was the most heavily traded stock with a volume of 4.1 million shares as it gained 0.8% to 63.5 cents after saying it extended and consolidated two tranches of its banking facilities.

Outside the benchmark index, ikeGPS fell 1.7% to $1.16 after reporting flat quarterly revenue, with a wider gross margin.

Meanwhile, Me Today climbed 7%, or 0.3 of a cent, to 4.6 cents after it upgraded guidance, saying it would report revenue of more than $7 million in the June year and an operating loss of less than $1.6 million.

Shares of Chatham Rock Phosphate were suspended after the exploration firm de-listed from the TSX Venture Exchange, meaning it was no longer a foreign exempt issuer. Chatham Rock has started its application to make the NZX its primary listing.

Reporting by Paul McBeth. Image from Curious News.