“The Australian reporting season is underway and a number of property companies are seeing the impact of higher interest rates. Nick Scali furniture reported strong numbers though its order book is slowing.”
The S&P/ASX 200 Index was up 0.32 per cent to 7528.2 points at 6pm NZ time.
New Zealand’s reporting season kicks off next week with Contact Energy providing its half-year result on Monday.
Goodson said the market wasn’t really impacted by the new government policies.
“No one expected the income insurance scheme to come in.
“But the increase in the minimum wage doesn’t make it easy for the Reserve Bank. The inflation cycle may have peaked with some prices starting to fall but wage inflation is still an issue and the bank may have to continue tightening for a while longer,” he said.
The markets Down Under followed another strong day on Wall Street which shrugged off some caution from Federal Reserve chair Jerome Powell in the fight against inflation.
The Dow Jones Industrial Average gained 0.78 per cent to 34,156.69 points; S&P 500 increased 1.29 per cent to 4164; and Nasdaq Composite rose 1.9 per cent to 12,113.79 and is now up 13.5 per cent for the year.
Speaking at the Washington Economic Club, Powell reiterated that the process of getting inflation down had begun, starting with the goods sector.
Powell said the disinflation was at a very early stage and “if we continue to get, for example strong labour market or higher inflation reports, it may well be the case that we have to do more and raise rates more than is priced in”.
At home, leading stocks Ebos Group added 50c to $43.50; Fletcher Building collected 11c or 2.06 per cent to $5.46; Mainfreight climbed another 50c to $76.90; Infratil gained 10c to $8.97; and Auckland International Airport increased 13c to $8.60 on trade worth $24.57m.
Ebos is expected to be included in the MSCI World Index on Friday, while property companies Argosy, unchanged at $1.14, and Precinct, up 1c to $1.25, may be removed from the MSCI Small Cap Index because of a lack of liquidity in their shares.
The energy sector had a strong day. Meridian was up 7c to $5.46; Mercury increased 12.5c or 1.99 per cent to $6.42, its highest level since late August last year; Vector gained 5c to $4.29, and Genesis added 4c to $2.83.
Retailers Hallenstein Glasson was up 12c or 2.22 per cent to $5.52; and The Warehouse Group gained 5c or 1.94 per cent to $2.63.
Freightways, up 17c or 1.81 per cent to $9.57, is changing its name to prepare for a dual listing on the Australian exchange. On March 1, it will be known as Freightways Group and its ticker code is changing from FRE to FRW as the former is already taken on the ASX. Freightways has recently increased its business in Australia after buying Allied Express Transport.
Goodson said listing in Australia will give Freightways more access to investment funds over there – “some companies have tried this but it doesn’t always play out”.
Napier Port bounced 11c or 3.79 per cent to $3.01; Ventia Services was up 7c or 2.73 per cent to $2.63; Winton Land increased 9c or 4.69 per cent to $2.01; Tourism Holdings gained 5c to $3.84; and Vulcan Steel was up 17c or 1.73 per cent to $9.98.
Other gainers were Synlait Milk up 6c to $3.54; Seeka adding 5c to $3.25; Tower collecting 1c to 68c; Steel & Tube increasing 4c or 2.94 per cent to $1.40; Millennium & Copthorne Hotels NZ improving 6c or 2.74 per cent to $2.25; and Smartpay up 5c or 3.76 per cent to $1.38.
Leading banks ANZ was up 44c to $28.55, and Westpac gained 36c to $26.33.
Vital Healthcare Property Trust was down 4c to $2.43; Eroad declined 4c or 4.26 per cent to 90c; Third Age Health fell 7c or 4.46 per cent to $1.50; and NZME decreased 3c or 2.54 per cent to $1.15.
Chatham Rock Phosphate was down 1.5c or 6.25 per cent to 22.5c. Chatham recently told the market that the exploration work programme for its selenium prospect in North Queensland has been approved by the Department of Resources.
