Big falls in a2 Milk and Fletcher Building saw the share market trade lower as investors played catch-up with weakness in foreign markets once trade resumed after the long Queen’s Birthday weekend.
By midday, the country’s biggest stock by market capitalisation, dual listed a2 Milk, was trading 83 cents or 5.25 per cent down at $14.97, as its price caught up with weakness yesterday in Australia.
Construction and building materials group Fletcher Building was trading at $5.13, down 12c or 2.3 per cent, after issuing a $30 million earnings downgrade for the 2019 year.
The partly a2 Milk-owned Synlait Milk – which is currently embroiled in a land dispute at Pokeno – dropped 36c or 4 per cent to $8.41
By midday the S&P/NZX50 index was 1 per cent down at just over 10,000 points.
Craigs Investment Partners head of private wealth research, Mark Lister, said the market was mostly playing catch-up with weakness in foreign markets.
«A2 Milk is a high-growth, high-return stock, so it’s always going to fall harder than the average,» he said.
Lister said Fetcher Building was trading off its low for the day of $5.01, and that the earnings downgrade was minor.
«The share market is still looking better than other markets but if the trend of rising trade tensions resumes, then you will see equities markets continue to weaken after a very strong start to the year,» he said.
In the US, sharp weakness in the technology sector was dragging the market lower.
Australian stocks yesterday posted their worst day in five months, the S&P/ASX200 closing down 1.19 per cent.