There were large index rebalances last night that may have affected some share prices, notably a2 Milk, which exited the MSCI Standard Index.
This may be related to a2 Milk declining 1.5 per cent yesterday. Despite trading up for most of the day, a2 Milk traded more than 44 million shares at the close with index-linked funds selling down the stock. It was the largest stock traded by value and volume. Synlait Milk, whose largest customer is a2 Milk, fell 3.9 per cent.
Meridian Energy was the strongest performer in the NZX 50, climbing 5.8 per cent with the stock price being pushed up by the company's on-market share buyback.
Spark New Zealand (+5.6 per cent) and Argosy Property (+4.6 per cent) also performed well, recovering from Monday's dip.
On the other hand, Sky Network Television lost 1.2 per cent.
Looking at NZ Business Outlook, activity indicators declined with headline business confidence down three points in November while own activity was down seven points compared to October. Cost and inflation pressures remain "extreme" with cost expectations at 88.7 and pricing intentions still elevated at 66.5.
International
US
The downwards run for main US indices in the wake of Omicron continues as of this morning, with all three of the S&P 500, Nasdaq, and Dow Jones Industrial Average having fallen around 1.6 per cent each.
Commentary around the Omicron virus spooked investors as Moderna CEO Stephane Bancel said he expects the company's existing vaccines to be less effective against the new strain.
Moderna has declined 6.4 per cent on the news, while competitor in the Covid-19 vaccine space Pfizer was Tuesday's best performing stock - posting a modest gain of 2 per cent at the time of writing.
Comments from recently re-elected Fed chair Jerome Powell caused jitters as well, with the bank signaling the end of the its QE program a few months sooner than expected. Powell justified this on the basis of inflation risk increasing – saying it is now time to retire its 'transitory' description.
Other notable stocks to push higher against the run of play included tech staple Apple Inc, nudging higher by 1.4 per cent after the Black Friday sales period.
No sectors made gains during this morning's session, with the laggards being financials and energy, which posted 2.6 and 2.4 per cent losses at the time of writing.
Global media company Discovery, along with hospitality and casino operator Caesar's Entertainment, posted losses of 7 per cent and 6.2 per cent, respectively. Both have likely fallen as Covid-exposed stocks, with limited news specifically related to each stock.
Rest of the world
Asian markets finished mostly lower overnight, with the Nikkei and Hang Seng falling 1.6 per cent each, along with the Shanghai Composite which remained unchanged.
Data included China's manufacturing Purchases Managers Index (PMI) rising to 50.1 points, half a point above expectations of 49.6. A PMI above 50.0 represents an expansion in the manufacturing sector.
Commodities
Despite continued uncertainty, gold has fallen 0.6 per cent to US$1,775 per ounce. WTI crude oil continued to slide (-6.7 per cent) with pandemic conditions likely reducing world demand, now priced US$65.5 per barrel. The US 10-year yield fell to 1.45 per cent after Federal Reserve Chair Jerome Powell's comments that the US central bank may speed up its tapering of asset purchases.
Australia
The ASX 200 gained 0.2 per cent on Tuesday, closing at 7,256 points.
Sector performance was mostly in the green, led by telecommunication services (+1.8 per cent) and A-REIT (+0.9 per cent). The underperforming sectors of the session were utilities (-1.2 per cent), consumer discretionary (-0.8 per cent), and healthcare (-0.1 per cent).
Collins Foods advanced the most, rising 12.6 per cent after releasing its half year results for the financial year 2022. The owner of KFC Australia, KFC Europe, and Taco Bell Australia delivered a strong financial performance, with its European operations returning to growth. Revenue increased by 8.5 per cent to A$534.2 million and statutory EBITDA from continuing operations was up 10 per cent to A$92.5 million. A fully franked interim dividend of 12 cents per ordinary share was also declared.
Next in line was Credit Corp Group, rallying 8.9 per cent. The debt collection and consumer lending firm announced yesterday that it had entered into a binding agreement to acquire the assets of Radio Rentals from Thorn Group. The total consideration was stated to be approximately A$60 million, which is subject to completion adjustments and will be funded from existing cash reserves. The transaction is scheduled for completion in December 2021 and resulted in a revised earnings guidance for 2022.
Net profit after tax was revised upwards to a range of A$92-97 million (versus its prior guidance of A$85-95 million, released on 4 November).
Mineral explorer Orocobre also performed well, up 7.9 per cent, following its 2021 AGM yesterday – while gold producer and explorer St Barbara closed 4.3 per cent lower, continuing last week's general trend. Perseus Mining also underperformed, decreasing 4.1 per cent.
Rounding out the session's underperformers was hearing device implant producer Cochlear, dropping 3.9 per cent.
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