Market close: NZ shares take a dive, a2 Milk battered again

The a2 Milk Company fell back under $7 after falling 46c or 6.44 per cent to $6.68. Photo / NZME

Global marketer a2 Milk was battered again – this time on regulatory fears – and fell more than 6 per cent, as the New Zealand sharemarket also took a dive.

The S&P was down 63.08 points or 0.5 per cent to 12,673.23, after having a strong morning but falling throughout the afternoon when the Asian markets opened. The local index reached an intraday high of 12,787.95 points.

There were 60 gainers and 65 decliners over the whole market on light trading of 32.64 million shares worth $135.6 million.

The a2 Milk Company, which exports strongly to China, fell back under $7 after falling 46c or 6.44 per cent to $6.68.

Comvita, which sends manuka honey products to China, may also have been affected by the same fears, dropping 10c or 2.94 per cent to $3.30. Synlait Milk was down 6c to $3.71.

Matt Goodson, managing director of Salt Funds Management, said two Chinese education companies listed in the United States had been hit by regulatory moves from their government.

"I'm sure a2 has fallen because of some vague regulatory fear because there was no specific news associated with them," he said.

The a2 Milk Company did announce the appointment of Amanda Hart, formerly Dyson Appliances head of human resources Australia and New Zealand, as its new chief people and culture officer.

The Chinese government has been placing bans on foreign investment in domestic companies listed in the US. TAL Education and New Oriental Education and Technology dropped 70 per cent and 54 per cent respectively.

The Hong Kong Hang Seng Index was down 3.41 per cent to 26,389.58, and the Shanghai Stock Exchange Composite Index declined 3.26 per cent to 3434.43 points at 5.45pm NZ time.

Over the weekend, Wall Street again hit record highs. The Dow Jones Industrial Average broke through the 35,000 points mark for the first time, finishing up 0.68 per cent to 35,061.55 as strong corporate earnings continued to be reported. The S&P 500 Index was up 1.01 per cent to 4411.79, and Nasdaq Composite rose 1.04 per cent to 14,836.99.

Goodson said the local market may have had a spillover from the falls in Hong Kong and Shanghai.

"Our market was quiet again and is waiting for next month's local earnings reports. The market will be more focused on the companies' outlook rather than their financial results.

"The economy has bounced back more strongly than expected six to nine months ago, and the debate will be about the longevity of the earnings. I expect cyclical stocks like Fletcher Building will be strong," said Goodson.

Stocks impacted by the Covid outbreaks in Australia and the pause in the transtasman travel bubble were again hit. Auckland International Airport fell 10c to $7.05; SkyCity Entertainment was down 8c or 2.48 per cent to $3.15; Air New Zealand declined 2c to $1.485; Serko shed 4c to $7.51; and Hallenstein Glasson decreased 4c to $7.31.

Market leader Fisher and Paykel Healthcare was down 20c to $32.45; Ryman Healthcare declined 22c to $12.80; Summerset Group Holdings decreased 7c to $13.21; and Napier Port lost 6c or 1.82 per cent to $3.24.

Personal lender Harmoney fell 9c or 3.80 per cent to $2.28; Scott Technology shed 5c or 1.85 per cent to $2.65; and Radius Residential Care slumped 6c or 7.32 per cent to 76c.

Meridian Energy increased 5.5c to $5.34; Vector was up 3c to $4.05; Mainfreight climbed $1.05 to $78.50; and Port of Tauranga picked up 3c to $7.15. F&C Investment Trust rose 25c or 1.49 per cent to $17.05.

NZME continued its strong run, gaining 2c or 1.98 per cent to $1.03; Sanford picked up 7c to $4.96; and Gentrack gained 3c to $2.07.

Wellington Drive Technologies reconfirmed increased revenue of US$45m-US$50m, up from $41m-$46m, for the 2021 financial year, and operating earnings (ebitda) of NZ$3.5m-$4.5m, up from $2.5m-$3m. Wellington's share price rose 1.7c or 13.93 per cent to 10.5c.

AMP is introducing a new customer service programme and its share price increased 1c to $1.15.