Market close: NZX slips after another sell-off on Wall St

The S&P/NZX 50 Index finished at 11,748.30, down 63.75 points or 0.54 per cent. Photo / File

The New Zealand sharemarket drifted after another sell-off on Wall Street, but the low interest rate environment is likely to underpin further positive gains here.

The S&P/NZX 50 Index finished at 11,748.30, down 63.75 points or 0.54 per cent after moving between a low of 11,684.560 and high of 11,813.78 on trading of 53.21 million shares worth $167.36 million. There were 62 gainers and 73 decliners over the whole market.

Jeremy Sullivan, investment advisor with Hamilton Hindin Greene, said "we are now entering the unknown territory of negative interest rates – and shares and property will benefit from this".

He said the 2023 government bond was now paying minus 0.004 per cent, and a total of $10 billion was withdrawn from bank term deposits in July – the first time there's been a reduction in 10 years.

"The Reserve Bank is planning another cash rate cut in February, the NZX is getting ready for negative bond yields and banks have been asked to get their systems in place by September.

"There's a wall of money out there looking for a home and, broadly speaking, the sharemarket will continue to rise. The market has defensive stocks paying good dividends and they are ripe for investors," Sullivan said.

There were very little price movements among most stocks on a quiet local market.

One of the day's biggest movers was retailer Briscoe Group, climbing 16c or 4.2 per cent to $4.04. Freightways was 13c to $7.44 and Foley Wines gained 5c or 2.58 per cent to $1.99.

Market heavyweight Fisher and Paykel Healthcare, which has experienced strong growth this year, continued to lose ground – just like the hot technology stocks in the United States, with investors taking profits. Fisher and Paykel fell 59c to $33.02 on trade worth $31.24m after last month reaching a high of $37.68.

Auckland International Airport was down 6.5c to $7.045 and most of the energy companies had falls – Genesis down 9c or 3.09 per cent to $2.82, Contact declined 6c to $6.24, Mercury slipped 6.5c to $5.215, and Meridian was up 2.5c to $4.995.

Sky Network Television chief executive Martin Stewart went on the market and bought 250,000 shares at an average of 15c each for an outlay of $37,500. He now holds 1.286 million shares in the network. Sky TV's share price crept up 0.1c to 14.9c a day after reporting its latest full-year result.

Fellow property company Asset Plus reaped more than $34m from institutions as part of its $60m capital raising to fund developments at an Albany property, to be leased by Auckland Council. Asset Plus fell 2.5c or 6.85 per cent to 34c.

Retirement village operator Summerset Group filled its seven-year bond issue of $150m, with a minimum rate of 2.3 per cent a year. The bonds will be issued on September 21, and Summerset's share price increased 5c to $8.50. Competitor Ryman Healthcare fell 11c to $13.59.

In the United States, the Dow Jones Industrial index had its second 400-point fall in three days, finishing at 27,534.58, down 1.45 per cent, after opening the day strongly. The S&P 500 was down 1.76 per cent to 3339.19 and the Nasdaq Composite fell 1.99 per cent to 10,919.59.

In see-sawing trade, the technology stocks were again hit – Apple falling 3.26 per cent to US$113.49 ($170.43), Netflix losing 3.9 per cent to US$480.67, Facebook declining 2.10 per cent to US$267.97, Microsoft down 2.8 per cent to US$205.37 and Amazon decreasing 2.86 per cent to US$3175.11.