Tide goes out on NZX50; ANZ sharpens knives

New Zealand’s S&P/NZX 50 index snapped a three-day run of gains with South Island electricity generator Meridian Energy weighing on the bourse as grid operator Transpower eyes a major upgrade to the Cook Strait link, while Spark New Zealand sank after shedding rights to its upcoming dividend payment.

SkyCity Entertainment Group’s underwriters in the retail component of its recent capital raising were left to pick up most of the offering, with investors cold on the casino operator’s efforts to prop up the balance sheet.

Across the Tasman, ANZ Group Holdings is reshaping its workforce, laying off 8.1% of its people as new chief executive Nuno Matos stamps his simplification mark on the smallest of Australia’s Four Pillars.

And the Murdoch family’s succession saga has come to an end with patriarch Rupert’s eldest son Lachlan keeping control of News Corp and Fox Corp in a US$3.3 billion settlement that will see Prudence, Elisabeth and James Murdoch give up their claims on the existing trust that controls the media empire.

Losing energy

The NZX50 fell 27.41 points, or 0.2%, to 13,253.73, with 20 stocks declining, 25 gaining, and five unchanged. Turnover across the main board was $128.6 million, of which Fisher & Paykel Healthcare accounted for $21 million, as it rose 0.3% to $38.30.

Meridian Energy was a major drag on the day, falling 2% to $5.75 in a mixed day for the electricity generator-retailers as grid operator Transpower said it applied to the Commerce Commission for a $1.1 billion upgrade to the Cook Strait link between the two islands. Contact Energy dipped 0.2% to $9.13 and Mercury NZ declined 0.3% to $6.74, while Genesis Energy increased 0.4% to $2.40.

Spark New Zealand dropped 4.2%, or 11 cents, to $2.50 after shedding rights to its 12.5 cents per share dividend, while Argosy Property slipped 0.8%, or 1 cent, to $1.23 as it shed rights to a 1.625 cents per share return.

The dual-listed lenders were weaker after ANZ Group Holdings said it plans to lay-off 3,500 people of its 43,000 workforce as new chief executive Nuno Matos seeks to simplify the smallest of Australia’s big four banks. ANZ dipped 0.1% to $36.49 on the NZX while Westpac Banking Corp was marginally weaker at $41.99.

“The big one on the day is more in Australia but will also have implications here, is the massive restructuring by ANZ bank, with 3,500 jobs across the organisation,” said Matt Goodson, managing director at Salt Funds Management.

Heartland Group Holdings rose 2.1% to 98 cents.

Playing the hand you’re dealt

SkyCity Entertainment Group fell 1.4% to 69 cents after the casino operator said underwriters picked up $30 million of the $45 million retail offering.

KMD Brands let the benchmark index lower, falling 5.6% to 25.5 cents on an unusually large volume of 6.2 million shares to be the most heavily traded stock on the day. Of that, 5.4 million shares were traded in one transaction at 25.75 cents each.

Stock market operator NZX posted the biggest gain on the day, up 2.2% at $1.42, while insurer Tower gained 2.1% to $1.71.

Outside the benchmark index, Delegat Group extended its rally for a 10^th straight session, jumping 6.3% to $4.93, its highest close since January.

“Delegats is continuing to surge after its earnings were less bad than feared,” Salt’s Goodson said.

New Zealand King Salmon Investments slipped 2.5% to 19.4 cents after the salmon farmer bought a site at the Cloudy Bay business park in Blenheim for $8.1 million.

Across the Tasman, Australia’s S&P/ASX 200 index was down 0.7% in late trading, with the major banks and energy stocks weighing on the bourse.

Meanwhile, News Corp was down 0.9% after the Murdoch family reached a settlement where Lauchlan will take control of News and Fox Corp once family patriarch Rupert Murdoch dies, with siblings Prudence, Elisabeth and Prudence giving up claims on the family trust.

ASX-listed Nine Entertainment Co was up 2.7% in late trading, while Seven West Media declined 1.7%. NZX-listed NZME gained 1.3% to $1.145.

The kiwi dollar traded at 59.50 US cents at 5pm in Auckland from 59.01 cents yesterday.

Statistics New Zealand figures today showed the volume of manufacturing sales shrank 2.9% in the June quarter, with the sharpest decline in meat and dairy, while wholesale trade figures showed stocks were down 3.4% at the end of June from a year earlier.

Reporting by Paul McBeth. Image from Curious News.