"There will be parts the economy moving again, but lots of businesses say they won't be in full swing until level 2," Smith said.
The benchmark index fell 3.1 per cent across the week, although it's up 22 per cent from the market's low-water mark. Smith said the recovery had been driven by fiscal stimulus hyping the market and that trend may begin to slow.
"Once the sugar rush dies off as stimulus slows, we might see markets turn to the downside — but I don't think it will test the lows," he said.
Air New Zealand led the market lower, falling 5.9 per cent to $1.205. The airline announced today that direct flights between Auckland and the Argentinian capital Buenos Aires will not resume and the launch of the non-stop service to New York will be delayed until after 2021.
Smith said the airline was in a difficult place, facing the same adverse conditions as Auckland International Airport but without the bigger balance sheet to give it runway. This increases the likelihood it will have to turn to the government for another loan, which may dilute shareholders in the future.
Auckland International Airport fell 2.6 per cent to $5.64.
Infratil was unchanged at $4.46. Its junior shareholder in Wellington International Airport - Wellington City Council - has agreed to underwrite a $75m loan facility as part of refinancing efforts for the airport.
"Wellington airport is a bit more insulated, not being a true international airport, so arguably has less headwinds than Auckland," Smith said.
Tourism Holdings fell 4 per cent to $1.20. Chief executive Grant Webster said that with no international tourists, the industry is facing a 70 per cent to 80 per cent reduction in revenue.
Casino operator SkyCity Entertainment Group declined 4.9 per cent to $2.12. Smith said the share price had been "getting ahead of itself" as the business was likely to still be impacted as long as social distancing measures are in place.
"There has been some value hunting for some stocks in the eye of the storm, but there is a bit of reality setting in," he said.
NZME fell further today, down 2.3 per cent to 21 cents. The stock was sold off heavily when the government's $50m media support package was deemed to be insufficient to offset adverse conditions. The share price is down 14.3 per cent across the week.
Sky Network Television fell 3.3 per cent to 29 cents.
Refining New Zealand continued to recover after a week of tumultuous trading amid chaotic oil prices. Shares in the refinery rose 2.2 per cent to 92 cents but are down 10.7 per cent from last Friday.
Fuel retailer Z Energy fell 1.6 per cent to $3.10.
Meridian Energy posted the day's biggest gain, up 2.8 per cent at $4.49.
Argosy Property rose 0.9 per cent to $1.09, continuing to climb after reporting a 3.6 per cent valuation increase to its portfolio yesterday. The share price is up 3.8 per cent this week.
Restaurant Brands New Zealand is set to gain from pent-up demand as it reopens its fast food restaurants' takeaway and delivery services under alert level 3. Its share price fell 0.9 per cent to $11.60.
"What we've seen in other countries is there can be a massive rush on luxuries like takeaways when things reopen," Smith said.
Retailer Briscoe Group rose 0.3 per cent to $3.09 while Kathmandu Holdings was unchanged at 74 cents.
