"We are seeing modest net inflows pushing the market up with investors favouring the businesses they have more confidence in through a potentially tougher run with Covid," said Shane Solly, a portfolio manager at Harbour Asset Management.
Property for Industry - which counts manufacturers as tenants - was among market leaders today, rising 4.1 per cent to $2.54.
Other property stocks also gained. Vital Healthcare Property Trust rose 2.7 per cent to $2.63, Investore Property increased 2.6 per cent to $1.97, Precinct Properties New Zealand advanced 2.4 per cent to $1.74 and Goodman Property Trust was up 2.1 per cent at $2.19.
Solly said the strong June performance of manufacturing index was an important indicator for the domestic economy which was supporting some sectors.
"Certainly, the property stocks do benefit from that improved activity," he said.
Kiwi Property Group was the only decliner in the sector, dropping 1.5 per cent to $1.02.
Restaurant Brands New Zealand led the market higher, gaining 6.4 per cent at $12.09, on a typically light volume of just 8,000 shares.
"The market as a whole is on quite low volumes as we are in a bit of a vacuum between reporting seasons," Solly said.
Fonterra Shareholders' Fund units fell 0.3 per cent to $3.88. The dairy exporter upgraded its 2020/21 milk price by 4 per cent to a midpoint of $6.40, due to recovering consumer appetite in China. It also trimmed the top of the forecast range for the season that's just finished due to a stronger currency.
Solly said strong consumer demand was good news for the dairy industry but bad news for non-farmer investors in the fund because the increased farm-gate price would increase operating expenses for Fonterra. The fund offers outside investors exposure to Fonterra's earnings stream and potential dividends.
A2 Milk rose 2.2 per cent to $20.70, likely buoyed by the improved demand from its key market. Its main supplier Synlait Milk fell 1 per cent to $7.09.
Meridian Energy rose 2 per cent to $4.69 as it continued to recover from last week's drop on Rio Tinto's decision to close the Tiwai Point aluminium smelter next year. Contact Energy also gained, up 0.4 per cent at $5.77.
While defensive stocks proved attractive, investors took a risk-off approach to virus-sensitive companies as the excitement from the vaccine update wore off.
Vista Group International dropped 4.5 per cent to $1.28, the day's biggest decline. Air New Zealand fell 3 per cent to $1.30 and Kathmandu Holdings slipped 2.6 per cent to $1.12.
"Stocks that have been a little bit stronger on the potential for a vaccine have given back some of their recent gains," Solly said.
