17 NZ stocks rise in index, 31 fall
New Zealand shares rose, pushing the benchmark index to a new record as continued lower interest rates nudged investors to seek better returns from equities.
The S&P/NZX50 Index gained 12.01 points, or 0.2 percent, to 7226.06. Within the index, 17 stocks gained, 31 fell and three were unchanged. Turnover was $108 million.
"Central banks have taken interest rates to infinity and beyond, and it's forcing people into risk assets and people are paying ever-more for them," Salt Funds Management managing director Matt Goodson said.
"New Zealand superficially has a very high yield, a number of the key companies are paying out more than 100 percent of the cash flow they're generating," he said.
With earnings season looming and school holidays nearly finished, turnover was relatively light, he said.
Steel & Tube Holdings gained 2.8 percent to $2.17. The share price has recovered from a fifteen-year low after a flow of bad news ceased.
"On the back of relatively low volumes this week it's recovered, in my view, closer to fair value, having been hammered after a long period of bad news," said James Bascand, equity analyst at Forsyth Barr.
"It got to a price which appears cheap compared to what the market thinks the profitability will be and what the dividend and hence yield will be. And a month out of the spotlight of negative news probably helps as well."
Fisher & Paykel led the index, gaining 3.3 percent to $10.55.
Investore Property rose 1.8 percent to $1.67 and Spark New Zealand advanced 1.5 percent to $3.84. Both had high volumes of trading, with 3.46 million shares traded in Investore and 2.34 million in Spark.
Restaurant Brands fell 0.7 percent to $5.41.
"They reiterated guidance, interestingly they did talk more positively about Carl's Jr which had been a bit of a struggle for them, that's reasonably encouraging," Mr Goodson said.
Comvita was the worst performer, down 4 percent to $10.60, and Xero fell 1.7 percent to $19.14.