Market close: Shares dip as interest rate cut question weighs on investors

Napier Port was among transport stocks to fall on concerns about global shipping.

New Zealand shares fell for a second day in quiet trading as the few investors returning to week pondered how quickly central banks will cut interest rates.

The S&P/NZX 50 Index declined 13.06 points, or 0.1 per cent, to 11,735.42. Across the main board, 12.9 million shares were traded for a turnover of $40.3 million as 73 stocks fell and 63 rose.

No companies crossed the million-share volume today, with Spark NZ the most heavily traded with 840,000 shares changing hands as it rose 0.7 per cent to $5.155.

“It’s a very quiet and very low volumes – we’re still a week away before the big players come back into the market,” said Grant Williamson, a director at Hamilton Hindin Greene.

United States employment figures were stronger than expected on Friday, and ANZ economists today said the momentum in jobs growth appeared too strong for the US Federal Reserve to start cutting its benchmark interest rate, despite the slowdown.

“Investors want to know if, when and how quickly can interest rates start to come down,” Williamson said.

“That really is the million-dollar question, and not just for our market.”

Property companies, which are typically sensitive to movements in rates, were broadly weaker. Precinct Properties NZ fell 3.1 per cent to $1.26, Kiwi Property Group declined 2.8 per cent to 85.5 cents, Argosy Property decreased 0.9 per cent to $1.135, and Investore Property slipped 0.8 per cent to $1.19.

“A lot of them are trading below their asset value,” Williamson said.

Napier Port fell 4.3 per cent to $2.43 in light trading, with just 7620 shares changing hands. Other transport stocks were also under pressure after shipping line Maersk said on Friday it’s avoiding the Red Sea for the foreseeable future due to the threat of attacks.

Port of Tauranga fell 2.7 per cent to $5.37, Mainfreight declined 0.5 per cent to $69.48 and South Port NZ was down 1.1 per cent at $7.27.

Scales Corp fell 3.5 per cent to $3.30, leading the benchmark index lower, also in light trading. The fruit company was one of several exporters to decline, with a2 Milk Co falling 2 per cent to $4.32, Air NZ declining 1.5 per cent to 54c, Fonterra Shareholders’ Fund units slipping 1.4 per cent to $3.44, and Fisher & Paykel Healthcare edging down 0.2 per cent to $23.84.

Retailers were mixed as investors await updates on the Christmas and New Year sale season. Hallenstein Glasson rose 4.4 per cent to $5.49, Briscoe Group increased 2 per cent to $4.65, Michael Hill International was unchanged at 96c, Warehouse Group was unchanged at $1.57, and KMD Holdings fell 2.7 per cent to 73 cents. Fast food operator Restaurant Brands rose 3.9 per cent to $4.

Employment software minnow Geo posted the sharpest fall on the main board, sliding 45 per cent- or 0.9 of a cent – to 1.1c after unveiling plans to delist from the stock exchange more than a decade since listing on the NZX’s now-defunct alternative market.

NZX was unchanged at $1.07.

Seafood company Sanford fell 1 per cent to $4.10 after rival Sealord – which will soon eclipse it in size once it completes the acquisition of Independent Fisheries – reported its first loss in 10 years. While IT costs and more expensive finance weighed on the bottom line, Sealord said its fishing business struggled in the year, whereas its aquaculture unit thrived.

Fishing farmer NZ King Salmon Investments increased 2 per cent to 25.5 cents and was the second-most traded stock on a volume of almost 807,000 shares.

Energy companies were generally stronger today. Contact Energy rose 1.6 per cent to $8.17, Meridian Energy was up 1.4 per cent at $5.63 and Manawa Energy increased 0.2 per cent to $4.27. Genesis Energy was unchanged at $2.49 and Mercury NZ fell 1 per cent to $6.64.

Building materials companies were mixed. Fletcher Building fell 1.7 per cent to $4.74 and Vulcan Steel declined 3.3 per cent to $8.10, while Steel & Tube Holdings was unchanged at $1.07 and Metro Performance Glass rose 0.7 per cent to 13.8c.