Market close: NZ shares fall as Kiwi dollar weighs on market

The NZ dollar fell from its intraday high of US70.16c and was trading at 69.97c. Photo / 123RF

The fast-rising NZ dollar began weighing on the New Zealand sharemarket, particularly those stocks that rely heavily on foreign exchange earnings.

During the day the NZ dollar broke through 70c and reached a two and a half year high against the American greenback, and the S&P/NZX 50 Index fell 65.95 points or 0.52 per cent to 12,602.02. However at 5.45pm the NZ dollar had fallen from its intraday high of US70.16c and was trading at 69.97c.

There were 62 gainers and 82 decliners on the local market, and trading was solid with 60 million shares worth $197.53 million changing hands.

Jeremy Sullivan, investment adviser with Hamilton Hindin Greene, said the strong Kiwi dollar will start affecting exporters – though they should have hedging in place – and offshore investors do take into account the direction of the currency. "The economy is doing better than expected and the chances of negative interest rates now seem unlikely."

ANZ economists said this week that the outlook is finely balanced. "It's much less clear further monetary stimulus is justified and it wouldn't take much to tip the balance and see us forecasting no further (or at least fewer) OCR cuts. There are reasons to be cautiously optimistic, but enormous uncertainty remains … including momentum in both housing, and business and consumer sentiment."

Fisher and Paykel Healthcare, a global exporter of medical devices, was hit, declining $1.06 or 3.33 per cent to $32.49 on trade worth $22.2m. Fisher and Paykel, which reported a record first-half financial result this week, has fallen from a high of $37.68 struck on August 28.

The other market heavyweight a2 Milk was up 22c to $14.72 on trade worth $16m. Mainfreight collected another 40c to reach $61.40; Ryman Healthcare recovered 37c or 2.53 per cent to $14.98; Ebos Group increased 27c to $25.15, and retailer Briscoe Group gained 14c or 3.29 per cent to $4.39.

Air New Zealand lost 8c or 4.23 per cent to $1.81, Fletcher Building declined 7c to $5.81 and energy stocks were down -
Meridian falling16c or 2.55 per cent to $6.12, Contact losing 8c to $7.66 and Genesis decreasing 5.5c to $3.265.

The property stocks had a mixed day. Stride Property Group, which is buying a premium office building at 20 Customhouse Quay, Wellington for $228m – its third purchase in the last three months - has completed its $180m institutional placement at $2.14 a share, and its price declined 3c to $2.27.

Argosy reported steady net property income of $51m for the six months ending September and an increase in net profit to $114.6m following a revaluation gain on its near $2 billion portfolio of $79.8m. Its interim dividend of 4.35c a share has increased 21 per cent and its share price gained 3c or 2.10 per cent to $1.46.

Goodman Property Trust is redeveloping its Mt Roskill Roma Rd property, including building a 17.700 sq m logistics facility, and its share price increased 1.5c to $2.395. Property for Industry was also up 0.05c to $2.385. Precinct Properties was up 4.5c or 2.64 per cent to $1.75.

Vital Healthcare Property Trust jumped 8c or 2.74 per cent to $3 after telling the market it is selling three private hospitals in New South Wales and Tasmania for about $100m to fund the purchase of Grace Hospital in Tauranga.

Dual listed transportation services firm EROAD climbed 20c or 4.55 per cent to $4.60 after naming new chief technology officer Tim Hogan, formerly Warner Bros, TiVo and Webedia Entertainment, and reporting a 19 per cent increase in revenue to $45.8m for the six months ending September. Operating earnings (Ebitda) grew 29 per cent to $15.3m compared with the previous corresponding period.

Pacific Edge fell 4c or 5.48 per cent to 69c after reporting a 50 per cent increase in revenue to $4.1m and 25 per cent improvement in net loss to $7.1m, from $9.39m. United States operating revenue grew 46 per cent to $2.9m and Pacific Edge said it was scaling up there to position Cxbladder as the first-choice diagnostic test for urologists evaluating patients for bladder cancer.