Market close: A2 Milk lifts NZ sharemarket to big gain

Photo / NZME

The a2 Milk Company, a glowing example of a robust reporting season that is now completed, spurred the New Zealand sharemarket to an unexpected gain of more than one per cent.

Despite another weak day on Wall Street, the S&P/NZX 50 Index climbed steadily, gaining 141.71 points or 1.23 per cent to 11,648.65.

There were 75 gainers and 57 decliners over the whole market, with 27.54 million shares worth $97.43 million changing hands.

Dan Stratful, investment adviser with Forsyth Barr, said the local market was surprisingly strong given the negative sentiment in the United States.

The leading indices there were down again – the Dow Jones Industrial Average declined 0.57 per cent – as investors remained unsettled by the Federal Reserve's resolve to keep fighting inflation by raising interest rates even if it causes economic pain.

It was a different story in New Zealand with the market staging a broad rally.

Stratful said the local market is well aware that the Reserve Bank will keep hiking rates for the remainder of the year and with no deterioration in company earnings, it is holding up well.

"No company put out an alarming reporting. A2's was a great (financial) result and the start of a turnaround for them. It will be interesting to see if they can maintain the momentum. To have $816m cash on hand is just incredible," Stratful said.

Global marketer a2 Milk, which announced a 52 per cent lift in profit to $122.62m and a $150m capital return to shareholders, rose 36c or 6 per cent to $6.36 on trade worth $6.54m – a gain of more than 15.5 per cent in two days. It hit a low of $4.41 on May 5.

Fisher and Paykel Healthcare, the second biggest on market capitalisation, recovered 51c or 2.6 per cent to $20.12 on trade worth $10.17.

Auckland International Airport gained 9c to $7.67; Spark improved 11c or 2.08 per cent to $5.40; Chorus increased 8.5c to $7.995; Infratil was up 8c to $9.08; Summerset Group Holdings rose 53c or 4.93 per cent to $11.27; and Ryman Healthcare was up 10c to $9.05.

Among the energy companies, Contact was up 9c to $7.91; Mercury increased 5.5c to $5.93; and Meridian – the biggest company on market capitalisation – gained 3c to $4.98. Manawa Energy was down 10c to $5.96.

SkyCity Entertainment gained 4c to $2.92; Air New Zealand was up 2c or 3.05 per cent to 67.5c; Comvita increased 7c or 2.13 per cent to $3.35; Pushpay Holdings added 4c or 3.2 per cent to $1.29; and My Food Bag improved 2c or 2.86 per cent to 72c.

Ventia Services Group continues to climb, rising 8.4c or 2.73 per cent to $3.16 after listing in November at $1.77. NZ Oil & Gas was up 2.5c or 6.02 per cent to 44c, Move Logistics gained 4c or 3.08 per cent to $1.34; and AFT Pharmaceuticals increased 11c or 3.2 per cent to $3.55.

Evolve Education topped the gainers list, rising 10c or 16.67 per cent to 70c after announcing the sale of its New Zealand business to Anchorage Capital Partners for $46m. Evolve's subsidiary Lollipops Educare Holdings will continue to operate the 105 early education centres.

Carpet maker Bremworth, concentrating on woollen products, gained 4c or 7.14 per cent to 60c after earlier reporting a net profit increase of 30 per cent to $2.24m on revenue of $95.48m, down 14 per cent, for the 12 months ending June.

Among the decliners, Freightways was down 15c to $10.26; Sky Network Television decreased 5c or 2.04 per cent to $2.40; and Accordant Group shed 5c or 2.72 per cent to $1.79.

Port of Tauranga was down 16c or 2.35 per cent to $6.65; Napier Port declined 10c or 3.34 per cent to $2.89; and South Port New Zealand shed 10c to $8.70.

In the property sector that has been bogged down by rising wholesale interest rates, Kiwi Property was up 2c or 2.02 per cent to $1.01; Precinct Properties increased 3.5c or 2.65 per cent to $1.355; and Property for Industry was down 5c or 1.90 per cent to $2.575.

Transport and logistics software firm TradeWindow, unchanged at 70c, has established a sales agency agreement with PT Electronic Data Interchange Indonesia, a leading trade facilitator for government, ports, state-owned companies, banks and the private sector.