Property companies as Vital Healthcare Property Trust and Precinct Properties NZ and utilities including Contact Energy and Mercury NZ dragged the S&P/NZX 50 index into negative territory as analysts rethink their expectations for interest rate cuts.
Meanwhile, SkyCity Entertainment Group plumbed new depths after Australia’s Aristocrat Leisure sank when its first-half revenue fell short of expectations.
Staying across the Tasman, Commonwealth Bank of Australia gained after its quarterly earnings beat expectations, following some soft results from its peers, while Macquarie Group dropped after the Australian Securities and Investments Commission accused the bank of misreporting short sales.
And companies that have borne the brunt of the tariff slump continued to recover some of those losses, with Tourism Holdings, Skellerup Holdings and Serko among the day’s gainers.
The day after the day after
The NZX50 snapped a three-day rally, slipping 7.48 points, or 0.1%, to 12,779.26, with 25 stocks declining, 17 gaining and eight unchanged. Turnover across the main board was $127.5 million.
Stocks across Asia were mixed, with Australia’s S&P/ASX 200 index largely unchanged as CBA gained after meeting earnings expectations, offsetting declines from the likes of Macquarie over its pending ASIC suit.
Japan’s Nikkei 225 index was down 0.3% in afternoon trading while Hong Kong’s Hang Seng gained 1.8%.
Property stocks led the local market lower as the prospect of less aggressive rate cuts reduced the allure of companies that pay reliable dividends.
Vital Healthcare fell 3.1% to $1.87 and Investore Property declined 2.6% to $1.14, while Stride dropped 1.7% to $1.16 on a volume of 4.4 million shares – the most for the day. Precinct declined 1.3% to $1.17 and Kiwi Property slipped 0.6% to 90 cents.
Grant Davies, an investment adviser at Hamilton Hindin Greene, said the rise in interest rates several years ago weighed heavily on property companies.
“We’ve seen rates come down and it hasn’t really flowed through to the share prices,” Davies said. “They’ll sell the odd property here and there and get above the carrying value, so there’s clearly demand for property they’re selling.”
Utilities – which are also held for their reliable dividends – were also among the day’s decliners, with Genesis Energy down 1.1% at $2.295, while Contact slipped 0.6% to $9.25 and Mercury fell 0.5% to $6.07.
The house always wins?
SkyCity hit a new record low of $1.02, ending the day down 1.9% at $1.03. Across the Tasman, gaming group Aristocrat slumped 8.9% after missing analysts’ expectations.
Tourism Holdings rose 3.7% to $1.40, posting the biggest gain on the benchmark index. The rental campervan operator has been among the hardest hit by the threat of US tariffs crimping global trade and travel, and other firms that have been punished by investors also bounced today, with Skellerup gaining 2.3% to $4.85 and Serko climbing 1.8% to $3.42.
Retailers were mixed after Statistics New Zealand figures showed spending on credit and debit cards remained subdued in April.
Warehouse Group rose 1.2% to 83 cents, Michael Hill International gained 2.3% to 44 cents, while Briscoe Group slipped 0.2% to $4.71 and KMD Brands fell 1.4% to 37 cents.
Meanwhile, Air New Zealand was unchanged at 61.5 cents and Auckland International Airport decreased 0.2% to $7.96 after Stats NZ figures showed inbound tourism numbers eased in March.
The kiwi dollar traded at 59.40 US cents at 5pm in Auckland, unchanged from 7am and up from 58.89 cents yesterday.
Reporting by Paul McBeth. Image from Jon Cellier on Unsplash.