“The Budget is good news for some parts of the economy as it fuels more activity. But there may now be two more official cash rate rises from the Reserve Bank when the market was expecting only one more in the monetary policy statement next week.”
Lister said it was great news that the Treasury is no longer forecasting a recession because of the cyclone recovery – “but time will tell.”
Treasury is also predicting that inflation will fall to 3 per cent by next September, gross domestic product will grow 3.2 per cent this year and drop to 1 per cent next year and unemployment will peak at 5.3 per cent late next year.
Lister said he liked the higher-then-expected infrastructure spend. “That’s a commitment to get infrastructure moving and investing for the future.”
The NZX index rose earlier on the suggestion that a deal on the United States debt ceiling should be reached by the end of the week. The Dow Jones Industrial Average was up 1.24 per cent to 33,420.77 points; S&P Index increased 1.19 per cent to 4158.77; and Nasdaq Composite gained 1.28 per cent to 12,500.57 and is up 19.28 per cent so far this year.
At home, the retirement village stocks continued to rebound. Summerset Group increased 26c or 3.1 per cent to $8.66; Arvida Group was up 3c or 2.65 per cent to $1.16; and Oceania Healthcare gained 2c or 2.67 per cent to 77c. But Ryman Healthcare was down 4c to $5.60 on the eve of reporting its latest annual result.
Serko surged a further 23c or 7.74 per cent to $3.20 and has now risen nearly 37 per cent in two days since reporting a higher-than-expected annual result.
Hallenstein Glasson also rebounded, gaining 14c or 2.39 per cent to $6. Mercury Energy was up 14c or 2.21 per cent to $6.48; Auckland International Airport increased 10c to $8.89 on trade worth $22.28m; Eroad added 2c or 3.77 per cent to 55c; and Scott Technology collected 10c or 3.5 per cent to $2.96.
Synlait gained 6c or 4.17 per cent to $1.50; a2 Milk improved 5c to $5.65; Bremworth increased 3c or 8.11 per cent to 40c; PaySauce rose 3c or 11.54 per cent to 29c; and AFT Pharmaceuticals was up 6c to $3.46.
KMD Brands gained 2c or 1.82 per cent to $1.12 after updating the market with a 15.6 per cent increase in group sales for the third quarter ending April. Kathmandu sales were up 11.3 per cent, Rip Curl 7.9 per cent and Oboz shoes 120.3 per cent. For the nine-month period, group sales were up 27.7 per cent.
Goodman Property Trust, up 3c to $2.21, reported annual revenue of $213.8m, up 13.8 per cent, and a net loss of $135.4m mainly due to a $237.7m reduction in the value of its $4.8 billion portfolio. Its net tangible assets per share is $2.45 compared with $2.60 in the previous year. Goodman has one million square metres of warehouse and logistics space, with an occupancy of 99.5 per cent.
Restaurant Brands fell 80c or 10.96 per cent to $6.50 after telling shareholders at the annual meeting that sales for the first quarter grew 12 per cent but input cost pressures were constraining margins, particularly over the first half of the financial year.
Other decliners were Chorus down 15c to $8.27; Michael Hill giving up 3c or 2.75 per cent to $1.06; Steel & Tube falling 3c or 2.75 per cent to $1.06; Vulcan Steel shedding 10c to $8; Scales Corp decreasing 7c or 2.12 per cent to $3.23; and Napier Port down 5c or 2.03 per cent to $2.41.
WasteCo, down 0.001c to 7.2c, announced a conditional agreement to buy Invercargill-based Cleanways and Enviro South and Cromwell-based Wastech Services for $7.35m.
T&G Global, unchanged at $2, expects to report a gross loss of $28m-$34m for the 2023 financial year because of the Cyclone Gabrielle impact. The apple crop has been harvested with New Zealand supply volumes down 19 per cent on last year.
Four orchards, representing 13 per cent of T&G’s planted hectares in Hawke’s Bay, were severely impacted, while a further 22 per cent had some damage and will reduce productive capacity for two to three years.
