Market close: Late rally saves NZX from sharp fall

Photo / File

The New Zealand sharemarket picked itself up from a sharp fall with an afternoon rally – and Auckland International Airport led the way after holding its annual meeting.

The S&P/NZX 50 Index closed down 25.31 points or 0.2 per cent to 12,407.29, after earlier falling nearly 1 per cent to an intraday low of 12,356.02. Trading was solid with 76.57 million shares worth $203.49 million changing hands.

There were 49 gainers and 87 decliners over the whole market which has increased to 183 stocks following the debut listing of medicinal cannabis firm Rua Bioscience.

Sam Dickie, a senior portfolio manager with Fisher Funds, said the market had a decent rally as the heavyweights rebounded from their lows. "I suspect people were in there buying their favourite companies such as Fisher and Paykel Healthcare and a2 Milk."

Auckland International Airport climbed 16c or 2.22 per cent to $7.38 on trade worth $13.27m. The airport bosses told the shareholders at the annual meeting that they expected a full recovery to take longer than three years but were hopeful that domestic travel will return to normal within two years. The airport is planning capital expenditure of $250-$300m in the present 2021 financial year, and it continues to receive inquiries for new property developments.

Dickie said Auckland airport remains cautious with its commentary but "what astounds me is they are making a positive $10m a month of operating earnings (ebitdaf) despite the border being effectively closed and domestic travel is reduced. They have reduced their cost base and capex, and they are not far away from being free cash flow even."

Fisher and Paykel Healthcare recovered to $35.80 on trade worth $37.9m, down 60c for the day after falling as low as $35.50, and a2 Milk settled at $15.45 on trade worth $22.37m, down 1c after reaching $15.21.

The leading energy stocks continued to snap back recent gains. Contact was down 6c to $7.64, Meridian fell 7.5c to $5.34 and Mercury lost 5c to $5.16. Chorus declined 18c or 2.11 per cent to $8.34, and Port of Tauranga decreased 4c to $7.62.

Mainfreight went up 21c to $54.71, Z Energy continued to flourish by rising 6c or 2.05 per cent to $2.99, Briscoe Group gained 7c to $4.08, and utilities investor Infratil has found renewed life, climbing 9c to $5.49 after holding an investors' day.

Dickie said a raft of brokers have updated Infratil's net asset value because of its investment in "monster rock star" Canberra Data Centres, which is a phenomenal asset and is making a lot of money.

Restaurant Brands climbed 23c or 2 per cent to $12.23 after reporting improved sales. For the three months ending September total sales increased 12.8 per cent to $239.8m compared with the previous corresponding period.

The new kid on the block East Coast-based Rua Bioscience, founded in 2017, had a strong market debut, rising 18c or 36 per cent to 68c, after listing at 50c following a $20m capital raise.

There was plenty of "stagging" in the stock, with 8.6m shares worth $6m being traded. Rua Bioscience's substantial shareholders are Fang Group Investments with 16.84 per cent and Hikurangi Bioactives with 16.77 per cent.

NZX was up 5c or 2.91 per cent to $1.77 after earlier announcing that it had been selected to develop and operate the managed auction service for the New Zealand Emissions Trading Scheme in partnership with the European Energy Exchange.

Trading in Metlifecare shares is suspended Friday as Asia Pacific Village Group, backed by Swedish equity firm EQT, completes its $1.27 billion or $6 a share takeover. Metlifecare will delist from the NZX and Australian ASX exchanges on November 3.