The S&P/NZX50 Index rose 25.45 points, or 0.3 percent, to 7,771.57. Within the index, 27 stocks rose, 14 fell and nine were unchanged. Turnover was $160 million.
Jacinda Ardern became leader of the Labour Party on Tuesday, taking over from Andrew Little, and the positive reaction to her ascent has been dubbed the ‘Jacinda Effect’, with the Labour Party reporting an upsurge in volunteers and donations while international media have covered Ardern’s response to sexist questioning.
«Everyone’s just positioning themselves for the results, you’ve seen reasonable volumes in the leaders again – perhaps I’m drawing a long bow, but it could be the ‘Jacinda Effect’,» Rickey Ward, at JBWere said. «Markets are potentially looking at some sectors – carbon, construction, electricity. A week or so ago, people were dismissing a potential change in government, and perhaps that’s changed with Jacinda. It has focussed people back on some of the potential policy they might campaign on.
«Fletcher Building is recovering from Friday’s sell-off, that’s infrastructure spend, and there’s good volume going through the electricity sector – all those sorts of things which seem to be big on the agenda for the left,» Ward said. «There does seem to be reasonable volume going through these names in what is a quiet day.»
Fletcher Building gained 0.9 percent to $7.95, while Metro Performance Glass gained 0.7 percent to $1.44. Chorus gained 0.5 percent to $4.48, while Contact Energy dropped 0.6 percent to $5.34 and Genesis Energy fell 0.4 percent to $2.43.
A2 Milk was the best performer, up 3 percent to $4.80, its second consecutive record. On Friday, the milk marketer released a statement, in conjunction with Synlait Milk, saying the two are confident with the progress of their application to export a2 Platinum infant formula to China from Jan. 2018. Sales of the formula currently comprise about 8 percent of A2’s total infant formula sales.
«It just keeps breaking new highs, a lot of analysts upgraded their numbers over the last month. It’s a stand-out story, no doubt about it,» Ward said. «Most analysts have come out believing they can extend their Chinese success to other parts of the world, there’s a lot of support for it.»
Xero was the worst performer, down 1.2 percent to $27.02. The stock has gained 56 percent this year amidst positive earnings, but has fallen back over the past two sessions after reaching a three-year high on Friday.
«You can always find cynics when they rally high, naturally people take a bit of a breather and this is nothing more than that, I suspect,» Ward said.
Spark New Zealand dropped 0.8 percent to $3.84 and Z Energy fell 0.8 percent to $7.83.
Source: NBR
Link: https://www.nbr.co.nz/article/market-close-nz-shares-jacinda-effect-a2-milk-record-b-206173
