The New Zealand sharemarket had a late dive and fell 1 per cent as investors took some profit following the recent rally.

The S&P/NZX 50 Index was having a choppy session before its sharp fall
in the broker matching session and closed at 11,856.56, down 116.44 points or 0.97 per cent after reaching an intraday high of 11,973.01.

The index was flat for the week and is ahead 0.8 per cent for the year.

There were 58 gainers and 76 decliners over the whole market on volumes of 35.76 million share transactions worth $136.29 million.

Shane Solly, portfolio manager with Harbour Asset Management, said the market had a damp end to the week, giving back some of the earlier gains.

Interest rate cuts are now under way around the world. The European Central Bank (ECB) followed the Bank of Canada and reduced its official rate 25 basis points to 3.75 per cent for the first time in five years. All eyes are now on the US Federal Reserve meeting next week.

ECB president Christine Lagarde said the inflation outlook had improved markedly and there was a strong likelihood the central bank was moving to a dialling-back phase.

At home, ANZ Bank is now forecasting the first official cash rate cut in February next year, rather than May.

ANZ said the Reserve Bank’s concern about the run of higher-than-expected domestic inflation is understandable, but “we expect that meaningful progress is around the corner. The real economy is very weak”.

“By February next year, we are anticipating the Reserve Bank will have seen fourth-quarter CPI inflation at 2.6 per cent (non-tradable still 4.7 per cent year-on-year, but we are forecasting sub-4 per cent the following quarter), and unemployment through 5 per cent. That should do it.”

There was profit-taking in Fisher & Paykel Healthcare, down 50c to $30; Infratil declining 34c or 2.98 per cent to $11.06; Auckland International Airport decreasing 13c to $7.67; and the leading energy stocks.

Meridian was down 17.5c or 2.7 per cent to $6.30; Mercury declined 15c or 2.21 per cent to $6.68; and Contact eased 14c to $9.20.

Skellerup declined 9c or 2.3 per cent to $3.81, and Freightways was down 8c to $7.90.

Solly said Infratil reached an all-time high the day before on speculation it will be included in a global index. Infratil has attractive long-term growth opportunities in data centres and renewable energy.

Mercury Energy told the market it is proceeding with the $486m expansion of the Kaiwera Downs wind farm near Gore following the long-term supply agreement for the Tiwai Point smelter.

The additional 155MW will power 73,000 homes a year, and when fully operational at the end of 2026 the Kaiwera wind farm will be the country’s second-largest, generating 198MW.

Solly said Mercury “is putting in some chunky investment, and on the back of the smelter announcement, could we be facing a green energy transition – it’s possible”.

SkyCity Entertainment recovered 3c or 2.04 per cent to $1.50 after telling the market the Federal Court has approved the agreement with Australian Transaction Reports and Analysis Centre over Adelaide casino’s anti-money laundering breaches. SkyCity is paying a civil penalty of A$67m ($72m).

Synlait Milk was down a further 2c or 5.19 per cent to 36.5c as the market awaits its recapitalisation move. Fonterra Shareholders’ Fund declined 16c or 3.86 per cent to $3.99.

Other decliners were Comvita down 3c or 2.31 per cent to $1.27; NZX falling 4c or 3.64 per cent to $1.06; South Port NZ shedding 10c or 1.75 per cent to $5.60; and Seeka decreasing 6c or 2.39 per cent to $2.45.

Kiwi Property was down 1.5c or 1.8 per cent to 82c; Green Cross Health shed 4c or 4.12 per cent to 93c; Accordant Group decreased 1.5c or 3.53 per cent to 41c; and Metro Performance Glass declined 0.003c or 4.35 per cent to 6.6c.

Scales Corp, up 5c to $3.50, released a presentation on the growth opportunities of its global proteins division, which supplies eight of the top global petfood brands. Scales said petfood manufacturers are investing to meet customer demand and are looking to mitigate supply chain risks.

The global proteins division reached its 2023 operating earnings (ebitda) target in the 2021 financial year and is targeting $70m in the 2027 financial year.

Other gainers were Scott Technology up 7c or 2.94 per cent to $2.45; Delegat Group increasing 10c or 2.22 per cent to $4.60; Pacific Edge adding 0.006c or 6.32 per cent to 10.1c; and The Warehouse collecting 3c or 2.8 per cent to $1.10.