NZX trading activity, value of turnover rises in July

The volume and value of trading on New Zealand's stock exchange rose for a second month in July as investors prepared for earnings season to kick off in August.

The total value traded rose 10% to $3.3 billion in July from the same month a year earlier, for an annual daily average of $142 million, according to NZX's shareholder metrics. The total number of trades rose 16% to 129,993 from a year earlier, of which 120,856 were less than $50,000. Share trading continued to dominate activity, with equity transactions up 17% to 127,328 for a 9.8% in value traded to $3.2 billion.

Investors are preparing for company earnings season to kick off properly next week. A global flood of cheap money looking for decent returns in a low interest rate environment has propped up stock markets around the world, and investors are looking for solid earnings growth to support the prices companies are trading at.

The value of NZX's equity market rose 15% to $103.1 billion, or 43.5% of gross domestic product, as at July 31, from a year earlier. At the end of the month, NZX had 171 equity securities listed, unchanged from a year earlier.

The stock exchange's debt market continued to struggle, with the total number of trades down 5.2% to 2665 from a year earlier, though the value was up 31% to $106 million. There were 7.1% fewer debt securities listed on the stock market at 79, with a market capitalisation of $13.2 billion, or 5.6% of GDP.

Some $420 million of new capital was listed in initial public offerings and compliance listings in July, taking the year to date total to $570 million, while $80 million of new debt was listed, taking the running 2015 total to $1.28 billion.

Some $2.39 billion of new capital was raised by all issuers in July across 13 events, and $3.61 billion has been raised this year.

NZX's SuperLife unit, which it acquired earlier this year, managed $1.37 billion of funds in July, of which $443 million was held in KiwiSaver funds. Its SmartShares unit had $1.01 billion under management.

The stock market operator launched nine new exchange traded funds on July 21, taking the number of other listed securities to 21.

NZX's derivatives operations increased the number of lots traded by 48% to 18,919 in July from a year earlier, while open interest grew 84% to 37,161. The volume of grain trading shrank 11% to 518,069 tonnes in the season to date.

The company's shares rose 1% to $1.05, and have declined 11% this year.

(BusinessDesk)