Market close: Sharemarket falls as all eyes await unemployment figures

All eyes will be on the release of the latest unemployment figures. Photo / File

The prospect of rising interest rates and a reduction in economic stimulus cast a shadow over the New Zealand sharemarket which fell nearly a half per cent.

The S&P/NZX 50 Index shed 52.75 points or 0.4 per cent to 13,044.50 after reaching an intraday high of 13,181.64. Trading was moderate, with 37.7 million shares worth $153.64 million changing hands. There were 84 gainers and 66 decliners over the whole market.

All eyes will be on the release of the latest unemployment figures. Greg Smith, head of research for Fat Prophets, said the unemployment rate for the fourth quarter ending December is predicted to be better than expected.

The market consensus is for the rate to rise from 5.3 per cent to 5.6 per cent – and not the double digit number forecast earlier last year when Covid-19 struck home.

Smith said "if the numbers look good, then that could signal the peak of the easing cycle by the Reserve Bank – and the easing party may even be over. Zero interest rates would be off the table and the rates can only go up from there.

"The market is waiting with bated breath to see the unemployment figures. There's a bit of nervousness in a weird way. A better-than-expected unemployment rate is something we should be championing, I suppose," he said.

Three of the market darlings over the past year drove the index down. Fisher and Paykel Healthcare fell 37c to $33.14 on trade worth $33.14m; a2 Milk slipped 38c or 3.31 per cent to $11.10; and Mainfreight lost $1.19 or 1.77 per cent to $66.16.

Interestingly, Mercury overtook Meridian as the more expensive stock. Mercury wasn't the subject of the strong overseas exchange traded funds buying like Meridian and Contact, and it has remained consistent, rising 4.5c to $7.14.

Meridian was down 8c to $7.10, after falling from its peak of $9.40 on January 7. Mercury's high on January 8 was $7.385.

Contact Energy was down 4c to $8.41, while Trustpower – looking to sell its retail operation – gained 8c to $8.78, and Tilt Renewables increased 3c to $6.33.

Other movers were Ebos Group, up 20c to $28.70; Spark picking up 6.5c to $4.85; Fletcher Building increasing 8c to $6.30; Summerset Group Holdings gaining 6c to $12.06; Briscoe Group climbing 18c or 3.43 per cent to $5.43; and Restaurant Brands up 30c or 2.56 per cent to $12.

Port of Tauranga chief executive Mark Cairns, who retires from his role in June, is joining the Freightways board on April 1. Cairns is also a director of Meridian and Northport, which is 50 per cent owned by Port of Tauranga. Freightways' share price fell late in the day by 5c to $10.80. Port of Tauranga was also down 16c or 2.1 per cent to $7.39.

Seafood company Sanford has pleaded guilty in court to three charges of bottom trawling in a benthic protected area, involving the San Waitaki fishing vessel, and its share price fell 12c or 2.48 per cent to $4.71.

Wellington-based Volpara Health Technologies, which is listed only on the Australian ASX exchange, has bought American firm CRA Health for US$18m ($25m), with a further US$4m payable on future performance.

CRA is a leader in breast cancer risk assessment and Volpara, which will have annual recurring revenue of $26.9m, will have coverage of more than 30 per cent of US women getting screened. Volpara's share price rose 5.4c 3.7 per cent to A$1.54 ($1.63) at 5.30pm (NZ time).

The renewed interest in the sharemarket, fuelled by low interest rates, is shown by the latest statistics released by the NZX exchange. The total value traded last year increased 41.8 per cent to $53.673 billion, the daily average value traded rose 41.3 per cent to $213m, and the on-market value traded climbed 62 per cent to $33.274b.

The average on-market trade size fell 37.4 per cent to $2793, showing the increasing influence of the online trading platforms such as Sharesies.