Market close: NZ stocks slump as property, energy sector hit again

The New Zealand sharemarket slumped more than one and a half per cent. Photo / NZME

Kiwi Property became the first to report a decline in portfolio revaluation, and others are sure to follow, as the New Zealand sharemarket slumped more than one and a half per cent.

The interest rate-sensitive property and energy stocks were again hit, with the market sectors falling 1.98 per cent and 2.11 per cent respectively.

The S&P/NZX 50 Index was down 185.3 points or 1.67per cent to 10,918.48. There were 116 decliners and just 25 gainers on the main board, with only 18.53 million shares worth $71.03 million changing hands.

Dan Stratful, investment adviser with Forsyth Barr, said the market has priced in property revaluation decreases.

"The higher interest rates have yet to flow through to corporate borrowing costs. The property companies, holding office, retail and industrial property, have both bank debt and bonds and their borrowing costs will go up.

"Industrial property will probably hold up better as it had been the star performer in the sector," Stratful said.

Kiwi Property, down 1c to 90.5c, told the market the valuation for the six months ending September will fall an expected 5.8 per cent because of high inflation and interest rates, and its mixed-use portfolio will be worth $3.4 billion, down $212.5m.

Argosy Property decreased 4c or 3.23 per cent to $1.20; Goodman Trust was down 3c to $2.045; Precinct Properties fell 6c or 4.69 per cent to $1.22; and Stride declined 3c or 1.84 per cent to $1.60.

Stratful said there was indiscriminate selling across the market following a strong jobs report in United States and another big fall on Wall Street. "Good economic news reinforces the fact that interest rates must go up."

The Dow Jones Industrial Average was down 2.11 per cent to 29,296.79 points; S&P 500 declined 2.8 per cent to 3639.66; and Nasdaq Composite fell 3.8 per cent to 10,652.40 over the weekend (NZ time).

"All eyes will be on the latest US reporting season which starts later this week and whether there is deterioration in earnings. Companies like Samsung, Nike and FedEx have already downgraded their outlook," said Stratful.

At home, Pushpay - investors have been waiting for any takeover developments - was up 4c or 3.48 per cent to $1.19 before it went into a trading halt late afternoon pending an announcement.

In the energy sector, Contact was down 20c or 2.72 per cent to $7.19; Mercury dropped 17c or 3.15 per cent to $5.22; Meridian declined 9c or 1.89 per cent to $4.66; Genesis shed 6.5c or 2.4 per cent to $2.64; and Vector was down 9c or 2.11 per cent to $4.18. Utilities investor Infratil declined 10c to $8.33.

Fisher and Paykel Healthcare decreased 59c or 3.06 per cent to $18.69; Ebos Group was down 60c to $36.20; Fletcher Building shed 13c or 2.51 per cent to $5.04; Mainfreight lost $1.86 or 2.75 per cent to $65.84; Delegat Group dropped 30c or 2.76 per cent to $10.58; and Restaurant Brands slid further, down 43c or 5.77 per cent to $7.02.

Summerset Group, down 22c or 2.13 per cent to $10.10, reported 219 sales (109 new and 110 resales) for the September quarter, 10 per cent higher than in the same period last year. Total sales for the nine months ending September reached 730 compared with 744 last year. Fellow retirement village operator Ryman Healthcare declined 12c to $8.45.

Among banks ANZ was down 48c to $27.10; Westpac declined 55c or 2.22 per cent to $24.25; and Heartland Group decreased 4c or 2.33 per cent to $1.68.

Synlait Milk fell 16c or 4.72 per cent to $3.23; Rakon was down 5c or 4.1 per cent to $1.17; Ventia Services shed 12c or 3.54 per cent to $2.97; Eroad decreased 6c or 3.97 per cent to $1.45; PGG Wrightson declined 9c or 2 per cent to $4.40; Vista Group lost 8c or 4/.82 per cent to $1.58; and NZME was down 3c or 2.54 per cent to $1.15.

Retailers KMD Brands was down 2c or 1.9 per cent to $1.03; Briscoe declined 10c or 1.89 per cent to $5.20; and The Warehouse decreased 7c or 2.15 per cent to $3.18.

Sky TV, declining 11c or 4.95 per cent to $2.11, has secured the World Rugby television rights for the next seven years.

Chorus was up 2c to $7.625 after telling the market that total fibre connections increased 21,000 to 980,000 during the first quarter of the 2023 financial year – compared with a 20,000 rise in the previous quarter. The fibre uptake on the completed ultra-fast broadband network is now 71 per cent.

Other gainers were Colonial Motor Company increasing 29c or 2.99 per cent to $10; Accordant Group up 7c or 4.09 per cent to $1.78; and Carbon Fund rising 8c or 3.67 per cent to $2.26.