F&P Healthcare drop leads NZX lower, rural stocks show strength
The benchmark S&P/NZX 50 index ended 73.52 points or 0.58% down at 12,686.68, with 23.5 million shares worth $101.05 million trading.
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NZ Herald
2 days ago
- NZ Herald
Briscoe homeware rebound offsets weak sporting spend
'Underperform' Forsyth Barr equity analyst Paul Koraua said the result was a 'good improvement', but the company had lost more margin than they had expected. However, because the share price has risen nearly 15% since the company was added to the NZX 50 index in June, the investment case has changed, he said. It is a stock that ordinarily trades on a price-to-earnings ratio of about 13, and it is currently sitting at about 20. 'That's more than three standard deviations away from its historic level,' he said. 'It just looks super expensive versus where it has historically traded.' A month ago, Forsyth Barr set its target price at $5.95 and downgraded it to 'underpeform' from 'neutral'. Guidance and sales mix The operator of Briscoes homeware and Rebel Sport stores said it expected group net profit after tax to be no less than $29m for this first half. In its first quarter update in May, the group said it expected first-half profits to come in 'around $30m'. The company maintained guidance that full-year profitability will be weighted to the second half, with Duke citing hopes for a gradual economic recovery. '[We] continue to expect second half profitability to exceed the first half in a return to a more normalised shape of annual profitability,' he said. Duke added that the group was 'disappointed' with a sales decline of 1.34% in the Rebel Sport segment. 'However, these sales tend to be more sensitive to the strength of discretionary spend, which continues to reflect the ongoing tough economic environment and subdued consumer sentiment.' Online sales comprised 19.97% of second-quarter revenue, with the half-year digital share rising to 19.36% from 18.77% a year earlier. Full half-year results are due on Sept 10, including an interim dividend announcement.
Otago Daily Times
2 days ago
- Otago Daily Times
What is the city council spending on?
Construction of One New Zealand Stadium at Te Kaha accounts for $92m of this year's Annual Plan budget. PHOTO:CCC About $1.6 billion will be spent on Christchurch City Council's Annual Plan this financial where it is going. Significant amendments to the draft Annual Plan were made by city councillors, with funding going to unexpected projects. The Air Force Museum of New Zealand will now receive $5 million towards its $16m extension project. The new wing will house the museum's C-130H Hercules and P-3K2 Orion. Another amendment is a pause in the Christ Church Cathedral reinstatement levy after the project was put on hold. The cathedral levy cost ratepayers $6.52 annually and was planned to last at least another three years. Other notable spending greenlighted through amendments include more chlorine-free water taps like those at Burnside Park and Rawhiti Domain. The taps will be installed with $900,000 allocated to the programme over three years from July next year. This will be enough to install at least two stations a year and potentially more if Government water regulations are relaxed as has been speculated. University students are winners of the budget with discounted prices for city council pools. A student ID will reduce prices to $4.90 from $6.70, in line with gold and community services cards. The reduced prices will start in July next year. Altogether, amendments added 0.04% to the rates increase. Rates have gone up by 6.6% on average to help pay for the $1.6 billion budgeted to cover the cost of running Christchurch. There will be $871 million in operational spending on day-to-day services and $648m in capital spending, including $95.5m for One New Zealand Stadium. Debt repayment will cost $81m. The city council will borrow about $366m to meet a budget shortfall with the goal of returning to surplus in 2028. Total debt will reach $2.8b after this year's Annual Plan. Mayor Phil Mauger says the Annual Plan strikes a 'difficult but necessary' balance between maintaining spending on services and keeping rates manageable. 'Across New Zealand, both organisations and households are grappling with challenging economic conditions and rising living costs, and our council is not immune to these pressures.' The rates increase will be 6.6% overall, including commercial properties, and 6.49% for the average household. This compares to a 9.52% average increase in the 2024/25 Annual Plan approved last year. Mauger points to 1.75% of this budget's rates increase going towards the One New Zealand Stadium build. 'If you take that out of the equation, the overall increase is below 5%,' he said. 'We will build on the foundation set this year – ensuring that Christchurch is well-positioned to face whatever lies ahead.' Several notable projects already had funding allocated in the draft Annual Plan ahead of the final budget. They include $20.3m for the continued Ōmōkihi South Library and Service Centre rebuild, expected to open end of next year. Flood protection and control infrastructure get $20m, which will help improve service and meet increasing demand. There is $19.6m for the activated sludge reactor at the Bromley waste plant, which aims to reduce greenhouse emissions and odour. Ongoing construction of the Ōtākaro-Avon River Corridor City to Sea shared pathway will cost $9.7m. It is due to open end of next year. The Akaroa Wharf will get $6.8m for its continuing upgrade, expected to finish in 2027. City council-funded community housing will receive $5.2m for any needed improvements. The Eastman Sutherland and Hoon Hay Wetlands will get $4.5m to improve stormwater capacity and reduce flooding. There is $3.5m for the Botanic Garden's Cunningham House, or main greenhouse, for an ongoing upgrade expected to finish next year. City council-owned companies and private organisations continue to receive significant grants from the city council. The funding includes Canterbury Museum getting $9m to continue its redevelopment and $4m going to city council-owned Venues Ōtautahi for any upgrades to major venues such as the Town Hall or Wolfbrook Arena. The city council-owned economic development agency ChristchurchNZ will receive $966,000. There is a $618,000 fund which major events hosts can request grants from. Some other well-known organisations receiving grants are Orana Wildlife Park ($260,000), The Arts Centre ($250,000) and the Watch This Space Street Art Programme ($250,000). City council income Rates cover about half of city council income with borrowing about a quarter. The rest mostly comes from fees to access city council services, and facilities and dividends from investments, particularly the city council's owned strategic assets such as Lyttelton Port Company and Christchurch International Airport. Rates: 52% $837m Borrowing: 25% $366m Fees, charges and operational subsidies: 12% $197m Dividends and interest from investments (including council-owned companies): 6% 102m Capital contributions, grants and subsidies: 3% $51m Development contributions: 2% $24m City council spending
1News
3 days ago
- 1News
Wall Street falls after employers slash hiring and tariffs roll out
The US stock market had its worst day since May after the government reported a sharp slowdown in hiring and President Donald Trump imposed sweeping tariffs on imports from a number of US trading partners. The S&P 500 fell 1.6%, its biggest decline since May 21 and its fourth straight loss. The index also posted a 2.4% loss for the week, marking a sharp shift from last week's record-setting streak of gains. The Dow Jones Industrial Average fell 1.2%, while the Nasdaq composite fell 2.2%. Worries on Wall Street about a weakening economy were heavily reinforced by the latest report on job growth in the US, employers added just 73,000 jobs in July. That is sharply lower than economists expected. The Labor Department also reported that revisions shaved a stunning 258,000 jobs off May and June payrolls. ADVERTISEMENT Markets also reacted to the latest tariff news. President Donald Trump announced tariff rates on dozens of countries and pushed back the scheduled effective date to August 7, adding more uncertainty to the global trade picture. "The market has been felled by a one-two punch of additional tariffs, as well as the weaker-than-expected employment data — not only for this month, but for the downward revisions to the prior months," said Sam Stovall, chief investment strategist at CFRA. Trump's decision to order the immediate firing of the head of the government agency that produces the monthly jobs figures will only fuel the market's uncertainty, Stovall added. The surprisingly weak hiring numbers led investors to step up their expectations for an interest rate cut in September. The market's odds of a quarter-point cut by the Federal Reserve rose to around 87% from just under 40% a day earlier, according to data from CME FedWatch. The question now: Will the Fed's policymakers consider a half-point cut next month, or even a quarter-point cut sometime before their next committee meeting, Stovall said. The yield on the 10-year Treasury fell to 4.21% from 4.39% just before the hiring report was released. That's a big move for the bond market. The yield on the two-year Treasury, which more closely tracks expectations for Fed actions, plunged to 3.68% from 3.94% just prior to the report's release. The Fed has held rates steady since December. A cut in rates would give the job market and overall economy a boost, but it could also risk fueling inflation, which is hovering stubbornly above the central bank's 2% target. ADVERTISEMENT An update on Thursday (local time) for the Fed's preferred measure of inflation showed that prices ticked higher in June, rising to 2.6% from 2.4% in May. The Fed has remained cautious about cutting interest rates because of worries that tariffs will add more fuel to inflation and weigh down economic growth. The central bank, though, also counts "maximum employment" as one of its two mandates along with keeping prices stable. Issues with either of those goals could prompt a shift in policy. The Fed held rates steady again at its most recent meeting this week. Fed Chair Jerome Powell has been pressured by Trump to cut the benchmark rate, though that decision isn't his to make alone, but belongs to the 12 members of the Federal Open Market Committee. "What had looked like a Teflon labour market showed some scratches this morning, as tariffs continue to work their way through the economy," said Ellen Zentner, chief economic strategist for Morgan Stanley Wealth Management. "A Fed that still appeared hesitant to lower rates may see a clearer path to a September cut, especially if data over the next month confirms the trend." Businesses, investors and the Fed are all operating under a cloud of uncertainty from Trump's tariff policy. The latest moves give 66 countries, the European Union, Taiwan and the Falkland Islands another seven days, instead of taking effect on Friday, as Trump stated earlier. Companies have been warning investors that the policy, with some tariffs already in effect while others change or get extended, has made it difficult to make forecasts. Walmart, Procter & Gamble and many others have warned about import taxes raising costs, eating into profits and raising prices for consumers. ADVERTISEMENT Internet retail giant Amazon fell 8.3%, despite reporting encouraging profit and sales for its most recent quarter. Technology behemoth Apple fell 2.5% after also beating Wall Street's profit and revenue forecasts. Both companies face tougher operating conditions because of tariffs, with Apple forecasting a USD$1.1 billion (NZ$1.8 billion) hit from the fees in the current quarter. Exxon Mobil fell 1.8% after reporting that profit dropped to the lowest level in four years and sales fell as oil prices slumped as OPEC+ ramped up production. All told, the S&P 500 fell 101.38 points to 6,238.01. The Dow dropped 542.40 points to 43,588.58, and the Nasdaq gave up 472.32 points to finish at 20,650.13. Stocks fell across the world. Germany's DAX fell 2.7% and France's CAC 40 fell 2.9%. South Korea's Kospi tumbled 3.9%
