Market close: Blue chips make strong recoveries to push NZ sharemarket higher

Fletcher Building increased 15c or 3.03 per cent to $5.10. Photo / NZME

Some blue chip stocks made strong recoveries as the New Zealand sharemarket gained another half per cent on the back of the Wall Street rebound.

The S&P/NZX 50 Index had a sluggish morning but then fired up to close at 10,916.65, up 69.31 points or 0.64 per cent – following a 0.57 per cent rise the day before.

There were 69 gainers and 65 decliners over the whole market and the investors are returning with 31.81 million shares worth $110.82 million changing hands.

Another strong banking quarterly earnings report, this time from Goldman Sachs, pushed the US major indices higher. Investors there were wondering if the US economy is currently in better shape than feared.

The Dow Jones Industrial Average gained 1.12 per cent to 30,523.8 points (up 2.98 per cent in two days); S&P 500 rose 1.14 per cent to 3719.98 (up 3.79 per cent); and Nasdaq Composite increased 0.9 per cent to 10,772.4 (up 4.33 per cent).

Dan Stratful, investment adviser with Forsyth Barr, said the positive markets on Wall Street this week has been led by a solid financial reporting season so far, especially from the banks.

"The US rebound is feeding on to us. Maybe investors are looking through the inflation numbers knowing inflation will subside next year. The US markets are quite oversold and the reporting is strong.

"This could drive an end-of-year rally. We do get a Christmas rally – it's a phenomenon that just happens," said Stratful. "I think any deterioration in US corporate earnings won't come through until next year."

The NZ dollar strengthened against the American greenback, trading at US56.91c after reaching an intraday high of US57.09c.

Among the blue chips, at home, Freightways surged 56c or 5.89 per cent to $10.06; Ebos Group gained 86c or 2.41 per cent to $36.51; Fletcher Building increased 15c or 3.03 per cent to $5.10; and a2 Milk was up 6c to $6.02.

Fisher and Paykel Healthcare continued to recover on trade worth $11m, up 8c to $19.60, bouncing off last week's low of $18.10.

The energy sector had a better day. Contact was up 14c or 1.97 per cent to $7.25; Mercury gained 10c or 1.96 per cent to $5.20; Genesis Energy added 7c or 2.66 per cent to $2.70; and Vector increased 6c to $4.05. But Manawa was down 6c to $5.23.

In the property sector, Kiwi gained 1.5c or 1.79 per cent to 85.5c, and Goodman Property Trust was down 4.5c or 2.27 per cent to $1.935.

Fast food operator Restaurant Brands picked up another 4c to $7.50, after sliding from $13.80 at the start of the year. Stratful said Restaurant Brands has fallen for no real reason. Companies like them are defensive and normally hold up well in tough economic times.

AFT Pharmaceuticals improved 12c or 3.35 per cent to $3.70; Accordant Group also rose 12c or 7.41 per cent to $1.74; Tourism Holdings gained 6c or 1.94 per cent to $3.15; Winton Land increased 4c or 1.72 per cent to $2.36; Gentrack added 5c or 3.11 per cent to $1.66; and ike GPS was up 2c or 2.2 per cent to 93c.

Port companies Napier increased 8c or 2.84 to $2.90, and Marsden Maritime Holdings was down 22c or 3.54 per cent to $6.

Auckland International Airport, up 3c to $7.21, told the market it is considering a fixed rate bond offer, maturing in May 2028.

Utilities investor Infratil gained 10c to $8.15. One of its investments CDC data centres has slightly downgraded its full-year operating earnings (ebitdaf) to A$210-$220m ($233m-$244m), from the previous guidance of A$220-$230m, because of labour and supply chain challenges delaying the completion of two new centres in Auckland.

Scales Corp was down 10c or 2.14 per cent to $4.57; Arvida shed 4c or 3.03 per cent to $1.28; Pacific Edge fell 2.5c or 5.26 per cent to 45c; Rakon declined 4c or 3.45 per cent to $1.12; Trade Window decreased 5c or 5.36 per cent to 53c; and Bremworth shed 2c or 4.26 per cent to 45c.

Retailers Hallenstein Glasson declined 15c or 2.78 per cent to $5.25, and Briscoe was down 5c to $4.95.

Task (formerly Plexure Group), up 1c or 3.03 per cent to 34c, has been selected by its Australian partner Retail Food Group to provide its mobile engagement platform across its Crust and Pizza Capers brands. This arrangement is likely to increase revenue by 10 per cent.

Cooks Coffee Company, down 1.5c or 3.9 per cent to 37c, has opened its renounceable rights issue at 36c a share. The money raised will be used to open new Esquires and Triple Two outlets and expand its offering.

Medicinal cannabis company Rua Bioscience, declining 0.005c or 1.92 per cent to 25.5c, has received its first export order through its German distributor Nimbus Health.