Market close: New Zealand shares bounce back with Summerset leading the way

Meridian's Benmore Dam. More than a million shares traded.

New Zealand shares joined a global rally, with record fourth-quarter sales at Summerset Group buoying fellow retirement village stocks.

The S&P/NZX 50 Index rose 108.97 points, or 0.9 per cent, to 11,844.39, snapping a two-day decline. Summer trading on the main board remained relatively quiet with a volume of 16.2 million shares changing hands for a turnover of $64.7 million, with 92 stocks gaining and 33 declining.

A strong day on Wall Street, led by US tech stocks, kicked off gains in global markets, with Australian and New Zealand stocks joining the rally.

Summerset was among the stronger performers on the day, rising 3.9 per cent to $10.86 after reporting a record 360 sales in the December quarter, with 186 new sales and 174 resales.

That took annual sales to 1103, and chief executive Scott Scoular said he was optimistic for the coming year with strong demand and pre-sales for occupation rights, and positive signs that the residential property market was improving.

“The day’s big story was Summerset’s absolute ripper of a quarterly update,” said Shane Solly, a portfolio manager at Harbour Asset Management. “That dragged up other parts of the market in quite a broad rally.”

Arvida climbed 5.2 per cent to $1.21, aged care operator Oceania Healthcare advanced 2.7 per cent to 77 cents, and Ryman Healthcare gained 0.7 per cent to $5.75.

Property stocks also rallied, with Precinct Properties NZ up 2.4 per cent at $1.29, Property For Industry rising 1.8 per cent to $2.24, Kiwi Property Group advancing 1.8 per cent to 87 cents, and Investore Property climbing 1.7 per cent to $1.21.

Solly said US inflation figures later this week will be important for analysts in gauging when and how much interest rates will fall, with markets getting a little optimistic about how early and steeply central banks will move.

The US Federal Reserve’s federal open market committee will meet at the end of this month, and minutes of their December meeting indicated cuts were likely this year, although the path was uncertain.

Fletcher Building rose 3 per cent to $4.88 with stronger than expected building approvals data in Australia. Steel & Tube climbed 5.6 per cent to $1.13 and Vulcan Steel gained 1.6 per cent to $8.23. Metro Performance Glass was unchanged at 13.8c.

Australian retail data also beat expectations, and local retailers might start updating the market on their Christmas and New Year sales periods in the coming weeks.

Retailers were mixed as KMD Brands rose 1.4 per cent to 74c, Briscoe Group fell 0.7 per cent to $4.62, Warehouse Group was unchanged at $1.57, Michael Hill International declined 1 per cent to 95c, and Hallenstein Glasson edged up 0.2 per cent to $5.50.

Local tech stocks were among those to come under pressure, with Pacific Edge falling 7.4 per cent to 11.2c, Eroad declining 5.3 per cent to 90c and Vista Group dropping 4.2 per cent to $1.60.

Synlait Milk fell 1.1 per cent to 95c after brokerage Forsyth Barr downgraded its target price on the stock to $1.10 from $1.40.

A2 Milk Co, which is in a dispute with its supplier Synlait, rose 1.9 per cent to $4.40, while Fonterra Shareholders’ Fund units advanced 0.6 per cent to $3.46.

Employment software minnow Geo bounced back from Monday’s near-halving in value as it rose 18.2 per cent, or 0.2 of a cent, to 1.3c. The firm plans to delist from the NZ Stock Exchange due to the cost of listing.

Stock market operator NZX was unchanged at $1.07.

Spark NZ was the most-traded stock on the day with a volume of 1.5 million shares changing hands as it rose 0.2 per cent to $5.20, while Meridian Energy was the only other company to cross the million-share threshold with 1.2 million traded, rising 1.4 per cent to $5.71.

NZ King Salmon Investments extended its rally to a sixth session as it rose 7.8 per cent to 27.5c.