MARKET CLOSE: NZ shares rise as Meridian adds to confidence
MARKET CLOSE: NZ shares rise as Meridian’s gains add to confidence; Telecom up
Oct. 30 (BusinessDesk) – New Zealand shares rose as Meridian Energy extended gains on its second day of trading, helping lift sentiment in a market with fewer calls on its cash. Telecom, Fletcher Building and Sky Network Television advanced.
The NZX 50 Index rose 15.486 points, or 0.3 percent, to 4868.08. Within the index, 27 stocks rose, 16 fell and seven were unchanged. Turnover was a higher than average $176 million.
Meridian, sold by the government in New Zealand’s biggest initial public offering, rose 1.9 percent to $1.10, bringing its two-day advance to 10 percent. About 141 million shares changed hands, amount to about 11 percent of the installment receipts on issue.
“The market should gain some confidence that Meridian, after two days, has had some strong buy-side activity,” said Nigel Scott, a director at Craigs Investment Partners.
He said demands on investor cash have abated with Meridian sold, the selldown of Summerset Group completed and a stake in Metlifecare going to just Infratil and the New Zealand Superannuation Fund. Contact Energy’s decision to redeem its 2042 hybrid bonds on Nov. 15 would see a further $200 million of funds looking for a home.
“Some of that cash is working its way back into the system,” he said.
OceanaGold led gainers, rising 4.2 percent to $1.74, Tower, the general insurer, rose 2.8 percent to $1.85 and Steel & Tube Holdings climbed 2.6 percent to $3.15.
Market heavyweight Fletcher Building rose 1.5 percent to $9.64.
Telecom rose 1.1 percent to $2.30 after the phone company spent $66 million on three lots of 2×15 MHz spectrum. Chorus rose 0.8 percent to $2.63 as chairwoman Sue Sheldon told shareholders the stock was weighed down by regulatory risk premium because of the threat of enforced price cuts for access to its wholesale copper lines
Sky TV continued to trade on higher-than-average volumes, rising about 1 percent to $6.20 as 2.4 million shares changed hands.
SkyCity Entertainment Group, which has also changed hands at large volumes, fell 0.3 percent to $3.92, with 5.6 million shares traded.
Skellerup Holdings rose 0.6 percent to $1.64. The industrial rubber goods manufacturer, expects annual profit to rise as much as 21 percent in the 2014 financial year with its industrial division tipped to make a bigger contribution.
Fonterra Shareholders’ Fund gained 0.4 percent to $6.91 a day after an independent report commissioned by the dairy company’s board into the whey protein concentrate scare made a range of recommendations without finding anything inherently wrong.
Wellington Drive Technology was unchanged at 20 cents after narrowing its third-quarter loss by selling higher-margin products and cutting costs, and affirming its guidance for a smaller full-year loss.