NZ shares bounce back from initial US election selloff 10 Nov 2016
Related articles
- NZ consumers grow more upbeat, may resume spending Business
- Knowles quits as CEO of KiwiBank Business
- NZ migration bolstered by British invasion Migration
- NZ manufacturing activity reaches highest since 04 Business
- NZ dollar hits 22-month high vs euro Business
- OceanaGold finds new gold deposits at Fraser mine Business
- Transpower gets go-ahead for $170m SI upgrade Business
- NZ home sales creep up in March, still subdued Property
- NZ economy expands at fastest pace in two years Business
- New Zealand food prices fall in February Business
Thursday 10 November 2016 10:48 AM
NZ shares bounce back from initial US election selloff; NZX 50 jumps 3.3%, bond yields surge
By Sophie Boot
Nov. 10 (BusinessDesk) - New Zealand shares rallied in early trading, regaining ground shed in the immediate aftermath of Donald Trump victory, as equity market investors deemed the change at the White House would benefit US economic growth.
The S&P/NZX 50 Index had its biggest fall in almost 8 years yesterday, down 3.3 percent on the day as it became increasingly apparent Trump would take out the US presidential race, with every stock on the benchmark index dropping.
Ten minutes after the market opened this morning, the local index had risen 3.3 percent, or 220.74 points, to 6,864.95. Some 43 stocks rose, seven were unchanged and one was trading lower. The biggest winner was A2 Milk Co, up 10.2 percent to $2.16, while Heartland Bank rose 5.6 percent to $1.50.
Markets across Asia were unsettled yesterday afternoon but US stocks gained sharply overnight local time as Wall Street came to terms with the political upset. The Dow Jones Industrial Average rose 1.4 percent and the Standard & Poor's 500 Index climbed 1.1 percent.
"Obviously we were at the forefront of trading as all news was coming out and there was an immediate huge reaction which is unwinding to a degree today, particularly after the US bounce," said Matt Goodson, managing director at Salt Funds Management.
"What was interesting overnight was quite a sharp selloff in US bond yields - the US ten-year is up almost 22 basis point, the US 30 year is up about 25 basis points, and yield-sensitive sectors were down overnight," Goodson said. "Obviously we have a very large portion of yield-sensitive stocks, with the gentailers, Spark, Auckland Airport and the property stocks in our market. It'll be very interesting to see what happens once these initial short-term reactions play out."
Longer-term interest rates followed suit in New Zealand today. The yield on 10-year government bonds jumped 23 basis points to 2.99 percent, the highest since late March. The 10-year swap rate soared to 3.11 percent from 2.94 percent.
Meanwhile, the CRB Index of commonly traded commodities rose 0.2 percent overnight, despite concerns that a Trump presidency will discourage global trade given he campaigned against the Trans-Pacific Partnership agreement.
The trade-weighted index was virtually unchanged from yesterday at 78.65, as the kiwi rebounded against the Japanese yen but fell against the US dollar.
"Commodities rose sharply overnight which was a surprise at a time where one of the cornerstones of Trump has been more difficult trade relationships with China and potential tariffs on Chinese products," Goodson said. "It's important to remember there are a lot of quantitative funds in the market, far more than has been the case historically, and they tend to trade off stock factors like volatility, yield or baskets of attributes as opposed to stock-specific news, so that was certainly something that whacked New Zealand last night."
(BusinessDesk)
ends
News
Hilary Timmins' Award-Winning UK Documentary Series To Inspire NZ Students
29 Jun 2020 Education
Dream Catchers, produced and directed by Hilary Timmins, celebrates the success stories of more than thirty inspirational New... more
New Zealand reaffirms support for Flight MH17 judicial process
7 Mar 2020 News
Ahead of the start of the criminal trial in the Netherlands on 9 March, Foreign Minister Winston Peters has reaffirmed the need to... more
Business
NZ Government's Economic package to fight COVID-19
17 Mar 2020 Business News
The Coalition Government has launched the most significant peace-time economic plan in modern New Zealand history to cushion the... more
NZ Government announces aviation relief package
19 Mar 2020 Business News
Transport Minister Phil Twyford today outlined the first tranche of the $600 million aviation sector relief package announced earlier... more
Living
Diversity was Key at New Zealand Trade Tasting in London
6 Jun 2022 Food & Wine
New Zealand Winegrowers Annual Trade Tasting was recently held in London, on Wednesday 4 May, in Lindley Hall.
It was the first... more
Kiwi author stuns Behind the Butterfly Gate
12 Jan 2022 Arts
Hidden behind the Butterfly Gate is where the secret has been kept for 76 years...
New Zealand writer Merryn Corcoran’s... more
Property
Fairer rules for tenants and landlords
17 Nov 2019 Property
17 NOVEMBER 2019
The Government has delivered on its promise to the over one million New Zealanders who now rent to make it fairer... more
New Zealand Government will not implement a Capital Gains Tax
17 Apr 2019 Property
The Coalition Government will not proceed with the Tax Working Group’s recommendation for a capital gains tax, Jacinda Ardern... more
Migration
Boosting border security with electronic travel authority – now over 500,000 issued
19 Nov 2019 Migration
19 NOVEMBER 2019
We’ve improved border security with the NZeTA, New Zealand Electronic Travel Authority, which helps us to... more
Christchurch reinstated as refugee settlement location
18 Aug 2018 Migration
18 AUGUST 2018
HON IAIN LEES-GALLOWAY
The announcement that Christchurch can once again be a settlement location for refugees... more
Travel
Gallipoli Anzac Day services cancelled
19 Mar 2020 Travel & Tourism
The New Zealand and Australian Governments have announced this year’s joint Anzac Day services at Gallipoli will be cancelled... more
New Zealanders advised not to travel overseas
19 Mar 2020 Travel & Tourism
New Zealanders advised not to travel overseas
more
Sport
The Skipper's Diary: Sir Richard Hadlee honouring his father and NZ's Forty-Niners
27 Oct 2019 Cricket
NZNewsUK London Editor Charlotte Everett spoke to Sir Richard Hadlee about why he’s chosen to publish his father’s... more
PREVIEW: All Blacks v England semi-final
26 Oct 2019 Rugby
The two most convincing quarterfinals winners are set to square off in a semifinal showdown for the ages when the All Blacks meet old... more
Columns
Gordon Campbell on the Gareth Morgan crusade
11 Nov 2016 Opinion
Gordon Campbell on the Gareth Morgan crusade
First published on Werewolf
The ghastly likes of Marine Le Pen in France and Geert ... more
Gordon Campbell on the US election outcome
10 Nov 2016 Opinion
Column - Gordon Campbell
Gordon Campbell on the US election outcome
Well um.. on the bright side, there (probably)... more
Kiwi Success
Congratulations to Loder Cup winner
26 Sep 2018 People
25 SEPTEMBER 2018
The Loder Cup, one of New Zealand’s oldest conservation awards, has been awarded to Robert McGowan for 2018... more
Appointments to New Zealand National Commission for UNESCO
16 Aug 2018 Appointments
16 AUGUST 2018Appointments to New Zealand National Commission for UNESCO
HON JENNY SALESA
Associate Education Minister Jenny Salesa is... more
Recruitment
Historic pay equity settlement for education support workers
14 Aug 2018 Recruitment
14 AUGUST 2018Historic pay equity settlement for education support workers
RT HON JACINDA ARDERN
HON CHRIS HIPKINS
Prime Minister
The... more
Historic pay equity settlement for education support workers
22 Aug 2018 Recruitment
14 AUGUST 2018Historic pay equity settlement for education support workers
RT HON JACINDA ARDERN
HON CHRIS HIPKINS
Prime Minister
The... more