MARKET CLOSE: NZX 50 snaps 6-day fall; PGC, PGW up

MARKET CLOSE: NZX 50 snaps 6-day losing streak; PGC, TEL, PGW gain

Feb. 4 (BusinessWire) – New Zealand shares rose, snapping a six-day losing streak, as higher-than-expected jobless figures prompted some investors to wind back the timing of central bank rate hikes and the kiwi dollar tumbled. Pyne Gould Corp., Telecom Corp. and PGG Wrightson were among the biggest gainers.

The NZX 50 Index rose 13.82, or 0.4%, to 3128.93. The benchmark has carved its own path this week, falling the past two days when equity markets across Asia were rising, and gaining today as the region sold off. Within the index, 24 stocks rose, 18 fell and nine were unchanged. Turnover was $82.4 million.

Investors are awaiting the earnings season for more clues to the pace of earnings through 2010, amid predictions companies will struggle to lift profit much as the economy revives from recession.

“There’s a lack of conviction in our market,” said Stephen Wright, private client adviser at ASB Securities. “The next bit of momentum will be with those results.”

PGG Wrightson rose 1.6% to 62 cents. The nation’s biggest rural services company today said it has repaid a $22.8 million subordinated debt facility to South Canterbury Finance, using its syndicated banking facilities.

“It shows they are getting out of some of the things they were forced to do,” Wright said. “Hopefully it is another sign they will start firing on all cylinders.”

Pyne Gould Corp., the financial group that owns about 18% of Wrightson, climbed 4.4% to 47 cents.

Telecom Corp., the biggest phone company on the NZX 50, rose about 3% to $2.41. The company asked seven “leading global technology companies” to improve its internal information technology services and asked for proposals without boundaries or directives, spokesman Ian Bonnar said. He made the comments in response to media reports that the company is looking to outsource IT work overseas.

Fisher & Paykel Healthcare, which gets almost 80% of its sales in U.S. dollars, climbed 0.3% to $3.38 as the kiwi dollar tumbled on the jobless figures.

New Zealand’s unemployment rate surged to 7.3% in the fourth quarter, according to government figures, higher than the central bank’s 6.6% estimate. The kiwi dollar recently traded at 69.71 U.S. cents.

AMP NZ Office Trust rose 1.4% to 74 cents after the commercial property investor said distributable profit rose 18.5% to $32.1 million in the first half. Chairman Craig Stobo warned that earnings could drop as much as 10% next year if the government implements reforms proposed by the Tax Working Group, including removal of building depreciation and the introduction of a land tax.

ING Property Trust climbed 1.3% to 78 cents.

Rakon Ltd., which makes crystal oscillators used in mobile phones and navigation systems, fell 6.5% to $1.01, the biggest decliner on the benchmark index.

NZ Farming Systems Uruguay fell 4.7% to 41 cents, the fourth daily decline. Results from Fonterra’s online auction of milk powder showed prices declined for a second month.

Clothing retailer Hallenstein Glasson Holdings fell 3.3% to $3/50 amid Guinness Peat Group dropped 2.3% to 85 cents.

(BusinessWire)