Wellington 6.5 magnitude quake sends capital into slow motion

Monday 22nd July 2013

A 6.5 magnitude earthquake in New Zealand's Cook Strait has closed Wellington financial trading rooms and shut down portions in the capital city as local authorities assess the damage.

Wellington trading desks at Bank of New Zealand and ANZ Bank New Zealand are closed as corporates in the capital join the rest of the city in checking buildings following a swarm of quakes off the coast near Seddon in the upper South Island that topped out with a magnitude 6.5 shake at 5.09 pm on Sunday, bigger than the devastating magnitude 6.3 quake that damaged Christchurch in February 2011.

Train services have been suspended and some streets in the central business district closed as authorities complete their checks. The Wellington City Council has urged people to stay out of the CBD until midday so checks can be made.

Contingency plans will mean the closed trading rooms won't freeze national liquidity, and there was little movement in the New Zealand dollar at the start of local trading, which opens before other markets.

Imre Speizer, market strategist at Westpac Banking Corp in Auckland, said people will be waiting to see how Asian investors react to the news. Typically there's a knee-jerk fall in the currency after an earthquake, though after the experience of Canterbury, which has $40 billion of building work in the pipelines, there are questions as to whether investors will look through the initial hit to the likely stimulus from any rebuilding activity.

"Do we price in the short-term blip, or do we price the total, knowing the history," he said.

The Reserve Bank's payments and settlements are operating as normal, and the NZX is scheduled to open as normal.

Local investors will be monitoring Wellington-based firms and companies with big exposure to damage in the capital when trading begins at 10am.

Telecommunications network operator Chorus has closed 24 buildings across Wellington, Blenheim and Seddon to ensure safety of workers, which it said may cause some disruption.

Precinct Properties New Zealand, which counts its 10 office towers in Wellington's central business district as 40 percent of its $1.6 billion portfolio, says it has suffered no major damage from yesterday's earthquake.

Wellington International Airport closed its runway after the quake yesterday for just over an hour before resuming flights after it was cleared.

Centreport general manager of operations Steve Harris said the capital's port company has closed its container area and will reassess that at 10am. It expects to be able to handle a container vessel due this afternoon. Most of the damage is on reclaimed land, of which they have "lost about five-to-10 metres."

BusinessDesk.co.nz

Comments from our readers

No comments yet