New Zealand stock exchange starts May strong with Infratil rising 3.5% at market close

The New Zealand benchmark index began the month on a positive note, showing a strong performance. However, it is still overshadowed by the Australian stock exchange. Fisher & Paykel Healthcare’s late rally helped boost the S&P/NZX 50 by 2.06% to 12.148.600 points, with over 44 million shares worth $153.9 million traded.

In contrast, the Australian S&P/ASX 200, which was down by more than 10% on April 7, has almost recovered since then, showing a 0.2% increase by 5 p.m. on Thursday and remained flat for the year. The NZX 50, which has never experienced a 10% decline this year, is still down by 7% for the year.

Greg Smith, the Head of Retail Investing at Devon Funds, attributed the slow recovery of the NZX to its defensive nature and lesser exposure to China compared to the ASX. He also highlighted that the Australian economy is stronger, leading to a faster recovery of Australian stocks. Smith mentioned that New Zealand investors are anticipating a rate cut to boost the economy and the stock market.

Regarding company announcements, Spark’s potential auction of half of its datacentre portfolio was noted, with media reports estimating its value at up to $1.2 billion. This news had a minor impact on Spark shares, which rose by 1.2%. Infratil experienced an uptick of 3.51% after Microsoft and Meta indicated increased investment in datacentres. This positive news alleviated concerns about a slowdown in datacentre investment by large US technology firms.

At the NZX annual general meeting, Chairman John McMahon provided a trading update, stating that revenues for the first quarter were $30.8 million, up 8.8% from the same period last year. Despite market volatility, the company remains cautiously optimistic for 2025 and maintains its operating earnings guidance range. The market operator’s shares also saw an increase of 1.95%.

In the realm of retirement villages and aged care facilities, Ryman Healthcare’s stock rose by 2.71%, while Summerset Group’s dropped by 0.74%. Fletcher Building showed steady gains, rising by 3.26%, benefitting from signs of economic recovery.

Overall, the NZX exhibited a positive start to May, driven by various factors such as individual stock performances, company announcements, and market trends. While challenges remain, the market is cautiously optimistic about the year ahead.