Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


MARKET CLOSE: NZ shares extend rally; Mainfreight, DIL rise

MARKET CLOSE: NZ shares extend rally; Mainfreight, Diligent at records

Dec. 20 (BusinessDesk) – New Zealand shares rose to a new five-year high, as foreign investors were drawn to the nation’s relatively attractive returns and cheered the expansion plans of companies such as SkyCity Entertainment Group. Mainfreight and Diligent Board Members Services hit new records.

The NZX 50 Index rose 52.45 points, or 1.3 percent, to 4075.45, the highest close since December 2007. Within the index, 33 stocks rose, eight fell and nine were unchanged. Turnover was a higher-than-average $166 million, surprising traders who were expecting a pre-Christmas wind-down.

SkyCity, the casino and hotel operator, rose 1.3 percent to $3.84, extending its gains of yesterday when it announced it had reached agreement with the South Australia state government on the expansion of its Adelaide casino. Separately today SkyCity said it sold its half-share of Christchurch casino and has taken full ownership of Queenstown’s gaming centre.

The SkyCity announcement on Adelaide “has been very well received,” said David Price, a broker at Forsyth Barr. The Adelaide expansion added about 25 cents to the stock’s valuation, he said.

Offshore investors were drawn to double-digit returns on New Zealand stocks, assuming for example, a 6n percent dividend yield and some capital appreciation, Price said. “There’s a lot of fresh money coming into the market.”

Diligent, which has soared 159 percent this year, rose 5.8 percent to $5.30, leading the NZX 50 higher. Xero, the cloud-based accounting platform, fell 1.3 percent to $7.60.

The two tech companies have been the star performers on the bourse this year, with Xero climbing 179 percent. That’s prompted some key investors to trim their holdings, including Trade Me founder Sam Morgan, who has reduced his stake below 5 percent.

Trade Me declined 1.3 percent to $3.94. Australia’s Fairfax Media sold its 51 percent stake this week.

Mainfreight, the logistics and transport group, rose about 4 percent to a record close of $11.75. the stock is rated ‘outperform’ based on six analyst recommendations compiled by Reuters.

Fletcher Building, the biggest company on the NZX 50, rose 2.2 percent to $8.45. Government figures today showed the economy grew a lower-than-expected 0.2 percent in the third quarter, with much of the growth being driven by construction activity.

Telecom rose 1.3 percent to $2.32. Chorus, the network company spun off from Telecom last year, rose 4.4 percent to $2.84, recovering some of the ground lost last week when the regulator gave a draft view on network price controls. Contact Energy rose 3.1 percent to $5.34.

Rakon, which makes crystal oscillators used in smart phones and navigation systems, dropped 9.8 percent to 37 cents. The company cut its full-year earnings guidance because of sales delays and thinner margins.

Earnings before interest, tax, depreciation and amortisation would be $8 million to $12 million in the year ending March 31, down from its August guidance of $14 million to $16 million. The shares reached $5.80 a May 2007, a year after its listing

“Rakon has a history of continuing to disappoint,” Price said.

Smiths City Group, the Christchurch-based retailer, rose 3.7 percent to 56 cents after posting a 2.6 percent gain in first-half profit and saying retail conditions are difficult, especially for consumer electronics. It kept its first-half dividend unchanged at 1 cent a share.

Veritas Investments, the shell company listed on the NZX after Salvus Strategic Investments was wound up, jumped 17 percent to 7 cents after announcing it had agreed to buy the Mad Butcher franchisor business in a $40 million cash and scrip deal, and will seek more funding.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

China Shopping: NZ-China FTA Upgrade Agreed Among Slew Of New Deals

New Zealand Prime Minister Bill English and China Premier Li Keqiang signed off a series of cooperation deals spanning trade, customs, travel and climate change and confirmed commencement of official talks on an upgrade to the nine-year old free-trade agreement between the two countries. More>>

ALSO:


Media: TVNZ Flags Job Cuts To Arrest Profit Decline

Chief executive Kevin Kenrick said the changes were aimed at creating "a sustainable future video content business for TVNZ in an ever-changing media market." More>>

ALSO:

Reserve Bank: Wheeler Keeps OCR At 1.75%

Reserve Bank governor Graeme Wheeler kept the official cash rate unchanged at 1.75 percent, as expected, and reiterated his view that the benchmark rate doesn't need shifting for the foreseeable future. More>>

ALSO:

Trade Plans: Prime Minister's Speech To International Business Forum

"The work to improve public services, build infrastructure, and solve social problems is possible only because we have enjoyed sustained, solid economic growth. A big reason for that is the Government’s consistent agenda of economic reform, and our determination to open up more opportunities for trade with the world." More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news