NZX50 rallies as blue chips buoyed by calmer oil markets

New Zealand’s S&P/NZX 50 index rallied as blue-chip stocks such as Fisher & Paykel Healthcare, Auckland International Airport, Infratil, Mercury NZ and Meridian Energy gained in a more upbeat mood as oil prices came back down to earth on the prospect that the Middle East conflict won’t be a protracted one.

Contact Energy was one of the few index heavyweights on the red side of the ledger, while Air New Zealand continued to test its all-time lows as the national carrier remains under pressure from elevated jet fuel prices.

Briscoe Group rallied after meeting its guidance for softer annual earnings as the retailer continued to eke out revenue growth, while ANZ card spending data showed households continued to loosen their purse strings in February.

And Serko led the benchmark index higher as the travel software developer continued to bask in the more optimistic mood following its briefing to investors this week.

Back once again

The NZX50 climbed 198.76 points, or 1.5%, to 13,293.13, with 35 stocks gaining, 11 declining and four unchanged. Turnover across the main board was $146.5 million, of which F&P Healthcare accounted for almost $21 million as the medical device maker gained 2.1% to $38.85.

The local benchmark played a little bit of catch up having nudged marginally lower on Tuesday, with stock markets across Asia posting more modest gains after US President Donald Trump played down the prospect of a protracted military campaign in Iran, even as airstrikes stepped up their intensity.

Polymarket prediction markets are pricing in a 52% chance of a ceasefire by the end of April, and Brent crude oil futures were down 0.8% at US$87.12 a barrel at 5pm in Auckland.

Australia’s S&P/ASX 200 index was up 0.7% in late trading, buoyed by mining and banking stocks, while Japan’s Nikkei 225 gained 2.8% and Hong Kong’s Hang Seng nudged up 0.1%.

Heavyweight companies underpinned gains on the NZX50, with Auckland Airport advancing 2.3% to $8.53, logistics group Mainfreight up 1.5% at $61.50, Infratil climbing 2.6% to $10.93, Meridian rising 3% to $5.55 and Mercury increasing 2.4% to $6.35.

Serko posted the biggest gain on the NZX50, up 5.6% at $2.06 in the software firm’s largest one-day gain since November as it continued to rally from its investor day on Tuesday. UBS analysts cut their target price on the stock by 8% to $4.

You’ll never buy better

Briscoe gained 2.4% to $1.265 after the retailer reported a 2.3% decline in annual profit, in line with guidance, and declared a 10 cents per share dividend, meeting expectations.

“There were record sales again for Rod Duke’s outfit, but there was a bit of margin compression emerging,” said Oliver Mander, chief executive of the New Zealand Shareholders’ Association. “The interesting question is whether that’s a portent of things to come for retailers.”

Separately, ANZ’s internal card spending figures showed a 4.4% increase in February expenditure from a year earlier, with housing-related spending one of the few soft spots.

Among other retailers, Hallenstein Glasson Holdings fell 0.4% to $9.88, KMD Brands rose 2.2% from a record low to 23 cents, Warehouse Group dropped 2.1% to 70.5 cents, and Michael Hill International gained 2.9% to 52 cents.

Horticulture companies Scales Corp gained 2.8% to $6.15 and T&G Global increased 0.4% to $2.53 as Heinz Wattie’s announced plans to cut its Wattie’s frozen vegetables line in a national restructuring that will see up to 350 people lose their jobs.

Investore Property posted the steepest decline on the day, down 2.8% at $1.045.

Vulcan Steel decreased 1.3%, or 10 cents, to $7.65 after shedding rights to a 2.5 cents per share dividend, while Goodman Property Trust dipped 1.5%, or 3 cents, to $1.93 after going ex-dividend on its upcoming 1.71 cents per unit distribution.

Air New Zealand was the most heavily traded stock on the day with a volume of 2.9 million as it fell 1.1% to 46 cents, near its all-time low in March 2009 on an adjusted basis.

Outside the benchmark index, Taiko Critical Minerals shares were halted – having last traded at 21.5 cents – by market supervisor NZ RegCo after the would-be miner released a financial model report to the stock exchange.

The kiwi dollar gave up some of its overnight gains, trading at 59.43 US cents at 5pm in Auckland from 59.10 cents yesterday. It fell to 82.84 Australian cents from 83.74 cents amid heightened expectations the Reserve Bank of Australia will raise the target cash rate next week.

“The effect of higher oil prices on headline inflation is large but temporary,” Westpac chief economist Luci Ellis said in a note. “The RBA monetary policy board will nevertheless feel compelled to react, especially given the hit to confidence and financial markets has so far not been severe.”

Reporting by Paul McBeth. Image from Curious News.