MARKET WRAP: NZ shares continue on record run

The New Zealand sharemarket ended the day up, extending last week's biggest weekly gain for two years.

The S&P NZX 50 index was up 21 points to 8959, on low turnover of $72 million. The New Zealand dollar was steady on 70USc.

Harbour Asset Management analyst Shane Solly says the volumes were “lower than normal”, due to the closure of the Australian market as it observed Queen’s birthday.

“They [Australians] are quite active in the New Zealand market now, Australian institutional investors in particular.”

Takeover target Tegel shares gained 0.84% to $1.20 after reporting a 17.7 percent slide in net profit for year to April 29 and releasing a target company statement.

The company's independent directors are unanimously recommending shareholders accept Philippine company Bounty's $1.23 per share takeover offer, which was described as fair by independent advisor KordaMentha. 

“The market hasn’t reacted in a great way; the stock price is slightly higher,” Mr Solly says.

A2 Milk shares gained 3.04% to $11.85 after BlackRock, the worlds largest asset managers disclosed a 5% stake in the company.

"With A2 going into the MSCI global index BlackRock followed through and brought a substantial stake," Mr Solly says.

Auckland International Airport continued to rise, its shares gained 1.75% to $6.97 after positive research highlighting its long-term growth potential, Mr Solly says.

After being included in the S&P NZX50, replacing CBL, Skellerup Holdings gained 2.51% to $2.04.

Mr Solly says Steel & Tube might have bottomed out, its shares gained 5.04% to $1.46.

“It had a bit of a bounce off its low point in the near term. There are a lot of moving parts still there for Steel & Tube so hopefully there are still some positives to come through.”

Continuing its stellar run of late, Ryman Healthcare shares gained 0.16% to $12.25. The shares hit an all-time high of $12.23 on Friday.

“That’s not a bad return for those investors that bought stock for $1.35 back in 1999,” Mr Solly says.

Pacific Edge shares fell 17% to 19c after a mixed profit result back in May. Mr Solly says investors are keen to see customer revenue structures, and are starting to get frustrated.

“We’re still waiting, and it’s been a long wait, even longer than many had expected.”

Smartshares recently reduced its holding in the company from 5.46% to 4.42%.

Mr Solly says there are a number of major macroeconomic drivers coming across the weak.

The main local focus will be on whether progress can be made toward de-nuclearisation and better US-North Korea relations when Donald Trump’s meets Kim Jong Un in Singapore tomorrow at 1pm.

Domestically, tomorrow electronic car transactions will be revealed, which Mr Solly says is a good gauge of activity.

On Thursday morning eyes will be on the Federal Reserve and markets, with the US policy rate expected to be raised.