Market close: Chorus takes a hit as rising interest rates weigh on sharemarket

The New Zealand sharemarket opened the week on a flat note. Photo / NZME

Rising interest rates continue to weigh on the New Zealand sharemarket as it opened the week on a flat note – and telecommunications company Chorus took a hit.

The S&P/NZX 50 Index traded in positive territory for most of the day before having a late fall, ending 17.82 points or 0.14 per cent down at 13,075.41, after reaching an intraday high of 13,142.02.

There were 80 gainers and 65 decliners across the whole market on light volume of 51.2 million share transactions worth $136.74 million.

Jeremy Sullivan, investment adviser with Hamilton Hindin Greene, said the market was struggling against the increased interest rates, and was still heading towards its worst year in a decade.

"Assets are being re-priced, especially those low growth, dividend-paying stocks. There is still underlying earnings growth for (many) companies but it's not keeping pace with the rising interest rates and inflation.

"The Australian bond index is having its worst year of returns for 27 years, and investors are leaving bond funds. Interest rates will be the single biggest headwind for markets, not Covid," Sullivan said.

The Bloomberg AusBonds Composite index has fallen 3.1 per cent this year, placing the benchmark on track for the poorest showing since 1994 – a year marked by a painful bond sell-off known as the "great bond massacre".

Chorus, a provider of telecommunications infrastructure throughout New Zealand, is one of those dividend-paying stocks, and its share price fell 16c or 2.5 per cent to $6.23. It has fallen 24.45 per cent over the past 12 months. Spark was down 3.5c to $4.515.

It was quiet day for moves amongst the top 50 stocks. Ebos Group gained 58c to $35.85, retirement village operator Ryman Healthcare was up 9c to $14.90, and SkyCity Entertainment rose 7c or 2.23 per cent to $3.21.

The leading banks ANZ Banking Group and Westpac Banking Corporation rose 35c to $29.80 and 29c to $27.07 respectively. Property companies Stride was up 7c or 3.04 per cent to $2.37; Property for Industry increased 4.5c to $2.955; and Argosy gained 2.5c to $1.595.

Contact Energy is planning to make a $200m green bond offer and the proceeds will be used for financing renewable generation. It share price gained 7c to $8.18. Meridian was down 5c to $4.97; and Mercury was up 9c to $6.19.

Market leader Fisher and Paykel Healthcare was down 24c to $30.61; Mainfreight shed $1.41 to $88.61; Skellerup Holdings declined 11c or 1.85 per cent to $5.85; and Synlait Milk fell 10c or 2.63 per cent to $3.70

Fonterra Shareholders' Fund slipped 1c to $3.96 after the giant co-operative forecast a record-equalling payout of $8.40 per kg milk solids, resulting in $13 billion flowing into regional New Zealand through milk price payments this season.

Fonterra said demand from China had eased over the last couple of months but other regions have stepped in to keep demand firm.

Steel & Tube Holdings continued its recovery, rising 4c or 3.51 per cent to $1.18, and has increased 81 per cent over the past year.

Other gainers were EROAD, up 12c or 2.29 per cent to $5.36; Evolve Education increasing 6c or 7.89 per cent to 82c; Gentrack rising 11c or 5.98 per cent to $1.95; ikeGPS collecting 4c or 4.04 per cent to $1.03; and Allied Farmers picking up 4c or 6.15 per cent to 69c.

Sky Network Television fell 8c or 4.17 per cent to $1.46, and Napier Port was down 5c to $3.03 and nearing its low of $3.02 achieved on May 5 last year. New listing Greenfern Industries declined 7.5c or 18.99 per cent to 32c.

Tourism Holdings, up 9c or 3.46 per cent to $2.69, is selling Mighway camper van hire and SHAREaCAMPER rentals to Camplify Holdings for A$7.37m ($7.72m). Tourism Holdings will continue to provide managed services to Camplify recreational vehicle owners.

Sullivan said Tourism Holdings' sale was not big but the company classed it as material.

Online lender Harmoney has secured an A$105m funding line, and its share price gained 3c to $1.99.

A restructured Move Logistics increased 2c to $1.62. James Watters, formerly Linfox Logistics (NZ) country manager, is joining Move in November as chief operating officer of the newly-created Contracts Logistics division. Chris Knuth moves from Followmont Transport QLD in December to become chief operating officer of Move's freight division.

Refining NZ was up 1c to 88c. The Court of Appeal earlier confirmed that all claims against the company as a defendant in a High Court carbon emissions case has been struck out.