Strong trading on NZX, despite global volatility fears

Cash market trading on the NZX continues to rise. Photo: Getty Images
Cash market trading on the NZX continues to rise. Photo: Getty Images
New Zealand share trading continued to push higher in May, despite ongoing global volatility, as low interest rates continue to fuel enthusiasm for the stock market.

Total cash market trading on the NZX rose 73% to 340,204 trades in May 2018 from the same month a year earlier, the stock exchange operator's monthly shareholder metrics show.

Total value traded rose 36% to $5 billion and daily average trades lifted 73% to 14,791.

The average on-market trade size was up 13 percent to $11,996.

Year-to-date the total number of trades is up 79% to 1.3 million and the total value traded is up 5.3% to $17 billion.

Global markets continued to be hard hit by ongoing concerns about the potential for a trade war between the US and China, as well as concerns around the political backdrop in Italy.

Domestically, however, the central bank held rates at a record low 1.75%, and said it expected to keep the official cash rate at an expansionary level for a considerable period of time, helping continue to generate interest in the market given limited returns for debt securities and bank deposits.

Of total trading, the bulk was in equity transactions that rose 75% to 336,929, while the value rose 39% to $4.9 billion.

Debt trading fell 12% to 3275 and the total value traded fell 24% to $140 million.

The S&P/NZX 50 Index ended May at 8659, up 17% on the year, while the market capitalisation of NZX's equities rose 46% to $129.3 billion, or 45.6% of gross domestic product. The debt market's value rose 9.5% to $27 billion or 9.5% of GDP.

The number of listed securities fell 1.7% on the year in May to 298. Stocks on the main board were down 7% to 120, NZAX listings down 5.9% to 16, NXT issuers unchanged at four and NZDX issuers up 9.3% to 47.

Some $382 million of secondary capital was raised in May across nine events, of which around half was equity by primary issuers.

In derivatives trading there was a 0.2% fall in futures lots to 20,238 and 0.1% fall in options to 5944. Open interest rose 4% to 46,505.

NZX's funds management division continued to expand, with total SuperLife funds under management up 17% to $2.1 billion and total Smartshares funds up 29% to $2.39 billion.

Funds under administration in NZX's wealth technology shrank 9.5% to $1.13 billion.

New Zealand agri data subscriptions rose 38% to 3664, while Australian data products increased 0.7% to 1501.

Paid ad page equivalents at the Farmers Weekly publication, which NZX has sold, fell 26% to $89 million, while year-to-date ad page fell 2% to $511 million

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