NZX struggles as world markets slip, Air NZ falls 2 per cent after update

The New Zealand sharemarket slipped on Thursday, following markets across the region lower.

The benchmark S&P/NZX50 Index closed down 0.3 per cent, or 49.2 points, at 12,970.99, following a 0.4 per cent decline on Wednesday.

Peter McIntyre​, investment adviser at Craigs Investment Partners, said markets had been negative across Asia.

“We’ve really struggled today.”

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Top stock Fisher & Paykel Healthcare was down 0.03 per cent at $30.93.

Shares in Air New Zealand fell 2.4 per cent to $1.62 after providing an update at its annual meeting on Thursday.

“Air New Zealand was interesting. It’s suspended its cash burn guidance and drawn down on the Government loan.

“It’s one that’s obviously struggling. Really they can’t give too much guidance at the moment,” McIntyre said.

Air New Zealand has spent $455m of its $1.5 billion in Crown loan facilities, and expected to draw down further to temporarily fund the delivery of two new narrow body jets and one turboprop aircraft.

Chairwoman Dame Therese Walsh told shareholders that ongoing uncertainty regarding domestic Covid alert levels made future cash burn difficult to forecast.

“While we are pleased to see good demand for domestic air travel in regions that are in Alert Level 2, this represents approximately 40 per cent of the domestic network.

“That flying, combined with the extension of government-supported cargo flying through the MIAC scheme from November through to the end of March is positive, but insufficient by itself to cover our cash requirements – in particular, near term fleet deliveries and the repayment of deferred PAYE payments,” Walsh said.

A2 Milk shares rose 0.3 per cent to $6.35, recovering from an 11 per cent slump after the company fronted for an investor day on Wednesday.

Sky TV was flat at $1.88 after giving shareholders at its annual general meeting a sneak peek of the new set-top box it expects to start offering by the middle of next year.

“They have given pretty strong updates and obviously technology improvement around their [set-top] box is going to drive revenue. They’re pretty flat but probably doing relatively well in what’s been a weak market today,” said McIntyre.

Freightways shares fell 0.8 per cent to $12.71 after the company also gave a trading update.

“They said parcel numbers are still strong, but they didn’t really give any definitive numbers, they’ve weakened off as the trading day’s progressed on light volumes,” McIntyre said.

ANZ shares fell 0.9 per cent to $29.72, after it said annual profit rose 39 per cent to $1.91​ billion.

On the up side, Mainfreight rose 1.2 per cent to $88.60, Port of Tauranga was up 1.6 per cent at $6.70, Skellerup, up 1.8 per cent at $6.11, and Contact Energy, up 1.1 per cent at $8.20.

Australia’s benchmark S&P/ASX200 Index was down 0.3 per cent, or 27.6 points, at 7421.

Earlier on Wall Street, the S&P 500 slipped 0.5 per cent to 4551.68. More than three quarters of the companies in the benchmark index fell, with financial, health care and industrial stocks accounting for most of the decline.

Those losses offset gains from communication services stocks and a mix of companies that rely on consumer spending.

The Dow Jones Industrial Average lost 0.7 per cent to 35,490.69. Both it and the S&P 500 had logged record highs the day before. The Nasdaq edged up less than 0.1 per cent to 15,235.84.

– With AP