New Zealand shares rose in heavy trading as several stocks entered MSCI indices, with new entrant Synlait Milk leading gains alongside Mercury NZ. A2 Milk Co fell.
The S&P/NZX 50 Index advanced 10.93 points, or 0.1 per cent, to 8,658.79. Within the index, 26 stocks rose, 18 fell and six were unchanged. Turnover was $1.26 billion. Market watchers and market operator NZX had anticipated this might be the biggest ever day of trading for the market, which hit a record $1.6b in trading one day in 2017.
The changes announced earlier this month in the semi-annual review of the MSCI Equity Indexes were implemented today. That saw A2 Milk included in the MSCI Global Standard Index, exiting the MSCI Global Small Cap Index, and Mercury leaving the standard index to join the small cap, an index which Restaurant Brands New Zealand, Synlait and Tourism Holdings also joined.
Investors who follow the indices are required to hold a certain amount of the stock, with changes causing selling and buying in new or departing stocks. NZX made amendments to trading times today to accommodate the heavier flows, with the pre-close session 15 minutes longer than usual and starting at 4:30pm, while the adjust session lasted until 5:50pm, rather than the usual 5:30pm, meaning enquiry (when the market closes) also took place at 5:50pm.
A2 Milk, which was bought up following the announcement on May 15, has been sold off lately after an earnings update disappointed investors. The stock ended the day down 0.1 per cent to $10.87, having traded as high as $11.13 and as low as $10.80 throughout the day.