A2 Milk dragged the S&P/NZX 50 index lower as soft Chinese manufacturing figures revived fears about the strength of the world’s second-biggest economy, which is facing an increasingly agitated US over their trade stoush. The kiwi dollar dropped as well.
Meanwhile, privately-owned publisher Stuff Group snatched the attention from rival NZME, stitching up a deal with the nation’s dominant listings site, Trade Me, which will become a 50% shareholder of the online Stuff Digital business, further separating the Masthead Publishing division from the nationwide platform.
Pacific Edge soared after upsizing its placement to institutional investors – which was done at a premium – although investors could still buy the shares cheaper on market.
And Ebos Group unwound most of last week’s decline when the Zuellig family’s Sybos unit sold down its stake of the healthcare products in a block trade, falling below the 5% threshold.
Heavy duty
The NZX50 dropped 91.66 points, or 0.8%, to 12,327.23, with 33 stocks declining, 12 gaining, and five unchanged. Across the main board, turnover was a relatively heavy $243.9 million, with Ebos accounting for $37.4 million of that and Fisher & Paykel Healthcare $31.8 million.
The local market lagged behind most of Asia which had tracked Wall Street’s tech-heavy Nasdaq Composite higher. Australia’s S&P/ASX 200 index was up 0.5% in late trading, while Japan’s Nikkei 225 index edged up 0.1% and Hong Kong’s Hang Seng jumped 1.1%.
A2 Milk led the local market lower, sinking 5.4% to $8.40 after Chinese manufacturing data showed activity unexpectedly shrank in May.
“We had some negative data out of China regarding manufacturing intentions and that’s part of the reason why A2 is off,” said Jeremy Sullivan, an investment adviser at Hamilton Hindin Green.
Synlait Milk was unchanged at 71 cents and Fonterra Shareholders’ Fund units rose 1.6% to $6.25 ahead of this week’s Global Dairy Trade auction.
Sullivan said the local market was playing catch-up after the long King’s Birthday weekend, and the MSCI index reweightings on Friday, when passive investors tracking indices need to tweak their portfolios.
New lows
KMD Brands fell 4.9% to a record-low 29 cents, while Oceania Healthcare declined 4.8% to 60 cents and Tourism Holdings dropped 4.4% to $1.32.
Vulcan Steel, which faces the prospect of steeper tariffs in the US, fell 4.3% to $6.87, while Steel & Tube Holdings was down 1.5% at 67 cents.
Warehouse Group posted the biggest gain on the benchmark index, up 3.2% at 98 cents, the highest it’s been since late February.
Ebos gained 2.7% to $38.05, unwinding much of last week’s slide when the Zuelligs sold down their stake in the healthcare products maker. F&P Healthcare rose 0.3% to $36.59.
Spark New Zealand was the most heavily traded stock with a volume of 3.7 million, falling 1.1% to $2.205.
Meridian Energy rose 1.6% to $5.58 after agreeing with the Tiwai Point smelter operator that it can ramp up production with healthy hydro storage levels.
Argosy Property slipped 1.9% to $1.02 after long-serving chief executive Peter Mence signalled plans to retire in 2027.
Outside the benchmark index, Pacific Edge jumped 16% to 9.5 cents after expanding its placement to institutional investors by $1 million to $16 million. The share sale was at a premium 10 cents per share, raising funds to help tide the cancer test maker over while it seeks to regain Medicaid coverage in the US.
“They’re talking a big game, saying they’re making big headway and the science is in their favour,” Sullivan said. “That buys them a bit more time and runway, before they get that coverage.”
This just in
NZME rose 1.7% to $1.20 after shareholders voted in favour of appointing Steven Joyce and Jim Grenon to the media group’s board, with Joyce taking over the chair. Chief executive Michael Boggs said earnings had improved, although consumer confidence remained soft.
Meanwhile, the group’s thunder was stolen somewhat by Stuff stitching up a deal with the country’s dominant online listings firm Trade Me – which had once been owned by Stuff’s previous owner, Fairfax New Zealand – for the group to take a half-stake of the media company’s digital platform.
It’s unclear whether Trade Me is investing new money in the company, or buying existing shares from its owner, and it comes after the classifieds firm last month refinanced about $2 billion of debt.
The kiwi dollar traded at 60.14 US cents at 5pm in Auckland from 60.34 cents at 7am and 59.63 cents yesterday.
Government figures today showed New Zealand’s goods terms of trade rose 1.9% in the March quarter, and the services terms of trade gained 4.2%.
