Market close: Vaccine news energises Covid-sensitive stocks

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Another vaccine breakthrough energised the Covid-sensitive stocks on the New Zealand sharemarket for the second time in just over a week and flattened Fisher and Paykel Healthcare.

American drug maker Moderna announced the Phase 3 clinical trial for its vaccine was 94.5 per cent effective against coronavirus. But there wasn't the same flurry locally following Pfizer's announcement last week as trading rotated to stocks that will benefit from a vaccine and the reopening of borders.

The S&P/NZX 50 Index had a slight gain, edging ahead 20.11 points or 0.16 per cent to 12,765.03 – following a big night on Wall Street with the three leading indices reaching all-time highs.

There were 75 gainers and 61 decliners locally over the whole market, and trading was heavy with 56.64 million shares worth $231.82 million changing hands.

"It's always the way – the first time you hear about a Covid breakthrough it's a shocking development and then when another comes along you take it in your stride," said Sam Dickie, a senior portfolio manager with Fisher Funds.

"What you saw today is the mechanics of the market. The heavyweights that dominate the market and are seen as beneficiaries of Covid dragged the overall index down and buying flowed to stocks that will benefit from a vaccine," Dickie said.

Fisher and Paykel Healthcare fell 40c to $34.20 on hefty trade worth $52m. Mainfreight was down $1.35 or 2.25 per cent to $58.504, Chorus declined 25c or 2.82 to $8.60, and Meridian lost 22c or 3.49 per cent to $6.08.

Among the Covid-sensitive stocks, Auckland International Airport climbed 14c or 1.83 per cent to $7.78; Air New Zealand was up 4.5c or 2.74 per cent to $1.69; Foley Wines increased 5c or 2.65 per cent to $1.94; Tourism Holdings gained 2c to $2.65; and Vista Group edged ahead 1c to $1.70.

Fletcher Building, which recently surprised the market with an earnings upgrade, continued its strong run, rising 15c or 2.75 per cent to $5.60. Serko was up 10c to $5.60, Z Energy gained 9c or 2.83 per cent to $3.27, and a2 Milk had a good day, rising 29c or 1.9 per cent to $15.59.

Mobile marketing provider Plexure Group rose 11c or 8.33 per cent to $1.43 after completing an over-subscribed placement of $32m at a discounted price of $1.20 a share.

The cannabis stocks neared their listing price of 50c, with Cannasouth falling 3c or 5.26 per cent to 54c and Rua Bioscience down 2c or 3.7 per cent to 52c.

Cannasouth is having Medicinal Cannabis Agency assessment of its first three white label products, which could be available to patients in the first half of next year.

Overnight on Wall Street, the Dow Jones Industrial Average climbed 470 points or 1.6 per cent to an all-time high of 29,950.44 on the Moderna news. It was Dow Jones' fastest rebound from a bear-market low in nearly three decades, after hitting 18,591.93 on March 23. Its previous high was 29,551.42 achieved on February 12.

Since the end of March, the Dow Jones has surged 60.5 per cent, the S&P 500 Index nearly 62 per cent and the technology-driven Nasdaq Composite more than 73 per cent. As the Dow Jones nears the psychological milestone of 30,000 points, it may confirm yet another bull market.