Santa rally arrives for NZX50 in best day since early August
Reports have been coming through that New Zealand’s poised to ink a trade deal with India.
New Zealand’s S&P/NZX 50 index is on track to notch up a positive December after the Santa rally arrived with a wide range of gainers on the local market, led higher by exporters including a2 Milk Co and Fisher & Paykel Healthcare amid reports of a pending free trade deal being struck with India.
Interest rate sensitive stocks including Summerset Group Holdings and Ryman Healthcare were among the leaders even as swap rates nudged higher.
Meanwhile, tech stocks Vista Group International, Gentrack and Serko followed Wall Street’s lead after a strong forecast from Micron Technology soothed some fears about the artificial intelligence sector.
And KMD Brands remained on the red side of the ledger in a forgetful year for the retailer, with it on track to mark its fourth annual double-digit decline.
Jingle all the way
The NZX50 climbed 174.9 points, or 1.3%, to 13,508.3 in its biggest daily gain since Aug 5. Within the index, 35 stocks gained, eight declined and seven were unchanged.
New Zealand trading rooms and corporate offices have already starting thinning out for the Christmas and New Year holidays, with turnover on the main board ending the session at $98.6 million, of which Auckland International Airport accounted for $13.7 million as it rose 1% to $8.23 on the day’s biggest volume of 1.7 million shares.
The country’s major gateway said it’s reviewing a High Court rejection of an appeal by the nation’s airports over the Commerce Commission’s work on the cost of capital used to set regulated price paths.
The local exchange was one of the stronger performers across Asia, with Australia’s S&P/ASX 200 index up 0.8% in late trading, while Japan’s Nikkei 225 jumped 2% and Singapore’s Straits Times Index advanced 0.8%.
The a2 Milk Co led the NZX50 higher, climbing 3.7% to $10.62, while heavyweight F&P Healthcare’s 2.1% rise to $37.89 buoyed the index.
Good things take time
Reports emerged over the weekend that New Zealand’s government is poised to announce a free trade agreement with India, which would be a boon to primarily primary sectors.
Local tech stocks joined the Friday rally on Wall Street as investors’ unease about the pace of investment in AI gave way to renewed optimism. Serko rose 2% to $3.01, Vista gained 2% to $2.53 and Gentrack advanced 1.2% to $8.45.
Infratil, which counts CDC Data Centres as its biggest investment, rose 1.6% to $11.15 after getting an investment grade BBB-plus credit rating from S&P Global Ratings.
Interest rate sensitive stocks shrugged off a rise in swap rates, with Summerset Group Holdings gaining 3.3% to $12.26 and Ryman Healthcare increasing 3.2% to $2.95. Fletcher Building climbed 3.1% to $3.71.
Spark New Zealand was unchanged at $2.24 after the telco sold $240 million of receivables for interest free payments on mobile handsets to Australia’s Challenger financial services firm, which will buy more receivables on a regular basis.
KMD Brands posted the biggest decline on the NZX50, falling 3.6% to 27 cents, while Fonterra Shareholders’ Fund units declined 0.8% to $8.25 and Freightways slipped 0.8% to $13.89.
The kiwi dollar traded at 57.67 US cents at 5pm in Auckland 57.65 cents last week.
Reporting by Paul McBeth. Image from Curious News.
