Sharemarket records 1.8% gain in a week

The S&P/NZX 50 Index hit a record 9,982.24 on Wednesday as tepid inflation data prompted traders to price in a greater chance of a rate cut, but gave up some of those gains on the following day when several companies downgraded their earnings outlooks.

The benchmark index ended the week at 9,959.62, down 22.62 points, or 0.2 percent, on Thursday. Within the index, 20 stocks fell, 20 gained, and 10 were unchanged. Turnover on Thursday was just $87.4 million in muted trading ahead of the Easter break.

The NZX50 is up 13 percent so far this year, and pays the third highest average dividend yield across benchmark indices in the Asia Pacific region tracked by Refinitiv. Those cash returns have been a major attraction for investors, who have been willing to take on the added risk of investing in equities, while low interest rates suppress corporate bond yields.

Stuart Williams, head of equities at Nikko Asset Management, said the stock market's strength can't be viewed in isolation to how bonds have performed, as interest rates remain low.