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NZ stocks down as Spark dips

NZ NewswireNZ Newswire 13/07/2016 Sophie Boot
© Bloomberg

New Zealand shares have been mixed as investors move towards cyclical stocks, with Spark down and property vehicles and banks gaining.

The S&P/NZX 50 Index dropped 0.2 per cent, or 15.2 points, to 7064.31 on Wednesday. Within the index, 30 stocks rose, 17 fell and four were unchanged. Turnover was $167.2 million.

"Across the region, there's a continued shift from defensive to more cyclical stocks - that's being driven by bond yields rising somewhat in the US market, and Japan looking to take ever-more aggressive action on the fiscal front," said Matt Goodson, managing director at Salt Funds Management.

Spark led the index lower, down 3.7 per cent to $3.68.

"Spark had a meteoric rise as people were chasing yield, all of a sudden there's been a rotation," Mr Goodson said.

However, he cautioned volumes on the downward shift were very light given it is school holidays in Australia and New Zealand.

Mighty River Power fell 2.6 per cent to $3.01, Tower dropped 1.9 per cent to $1.32, and Genesis Energy declined 1.6 per cent to $2.105.

Kathmandu Holdings gained the most, up 3.6 per cent to $1.75. It's risen 32 per cent since raising its annual earnings forecast at the end of June.

"There had been some fears in that name as it had been quite a warm early winter across Australia and NZ, but they appear to have successfully navigated through that," Mr Goodson said.

Kiwi Property Group gained 2.3 per cent to $1.54 and Vital Healthcare Property Trust rose 1.9 per cent to $2.195.

The banks continued to rebound. Heartland Bank gained 1.6 per cent to $1.27, ANZ rose 1.2 per cent to $25.70 and Westpac advanced 1 per cent to $31.

"The banks have made quite a recovery, they're hard hit by lower interest rates affecting profitability but showing modest signs of respite there," Mr Goodson said.

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