MARKET CLOSE: NZ shares rise; MightyRiver, Infratil gain on buybacks, AIA rises

Oct. 10 (BusinessDesk) – New Zealand shares rose as investors were attracted to Auckland International Airport’s earnings outlook, while Mighty River Power and Infratil rose on plans to return capital via buybacks.

The NZX 50 Index gained 6.747 points, or 0.1 percent, to 4717.380. Within the index, 24 stocks gained, 19 fell and seven were unchanged. Turnover was a lower-than-average $81.5 million.

Auckland Airport shares rose 2.5 percent to $3.32, bringing their advance this year to about 24 percent while the NZX 50 has gained 16 percent. In August, the airport said 2014 underlying earnings would be $160 million to $170 million, up from $153.8 million last year, helped by an expected pickup in Asian visitors.

“One of the premium stocks in New Zealand continues to be sought,” said Nigel Scott, a director at Craigs Investment Partners.

Trading activity was relatively subdued “as the market gathers its cash” for the Meridian Energy sale this month, and investors “have been looking over their shoulders at the unknown in the US” of a budget shutdown and looming debt ceiling deadline, he said.

MightyRiverPower rose 1.4 percent to $2.23 after the state-controlled power company announced plans to buy back about 1.8 percent of its stock, or up to $50 million worth, over the next 12 months. Its shares have traded below the $2.50 IPO price since the sale in May.

Infratil rose 0.2 percent to $2.515. The investment company plans an on-market buyback of up to 24.8 million shares through a tender offer at a maximum share price of $2.60 per share on Oct. 22, following the partial sale of its stake in Z Energy, which rose 0.8 percent to $4.01 today.

“Companies with additional cash are looking to buy back their shares that they see as currently undervalued,” Scott said.

New Zealand Oil & Gas rose 3.8 percent to 82.5 cents and was the biggest gainer on the NZX today. Xero fell 0.3 percent to $17.95 before its shares were halted pending the outcome of a capital raising.

Scott Technology, the industrial automation firm, rose 2.2 percent to $2.30 after reporting a 16 percent fall in annual profit, while declaring a special dividend marking its 100th year in operation.

Summerset Group rose 0.7 percent to $3.08. The retirement village operator said total sales of occupation rights rose to 102 in the three months ended Sept. 30 from 86 in the same period a year earlier. Of that, 52 were new sales, and 50 were resales, compared to 41 and 45 respectively in the third quarter of 2012.

Fletcher Building rose 0.4 percent to $9.42 and Telecom fell 0.7 percent to $2.285.

(BusinessDesk)

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