MARKET CLOSE: NZ stocks rise before Xmas, Fletcher gains
MARKET CLOSE: NZ stocks rise before Xmas, Fletcher gains on outlook
Dec. 24 (BusinessDesk) – New Zealand stocks rose on Christmas Eve, pushing the NZX 50 Index to a three-week high, as the outlook for the construction industry helped lift Fletcher Building and Warehouse Group led some retailers higher in the peak spending season.
The NZX 50 rose 45.30 points, or about 1 percent, to 4767.935 in the shortened pre-Christmas session. Within the index, 35 stocks rose, four fell and 11 were unchanged. Turnover was a modest $34 million.
Fletcher, the biggest company on the index, rose 2.1 percent to $8.72, the highest since Dec. 13 and has recovered from a four-month low reached last week. Steel & Tube Holdings, which sells steel building products, rose 2 percent to $3.
“Bargain hunters feel 2014 should be pretty good for the construction industry,” said Grant Williamson, a director at Hamilton Hindin Greene. Across the market, “buyers, although in small numbers, are in control.” Institutional volumes, though, have dried up as investors head away for their summer holidays, he said.
Warehouse, the biggest listed retailer, rose 2.7 percent to $3.75 as consumers flocked to stores for last-minute gifts. Paymark said spending in the first three weeks of December was 6.9 percent up on the same period last year, suggesting retailers may be in for a strong Christmas.
Trade Me Group, the auction website, gained 2.2 percent to $4.18 and Hallenstein Glasson Holdings, the clothing chain, rose 1.4 percent to $3.75. Pumpkin Patch, which sells children’s clothing, was up 1.2 percent to 82 cents. Michael Hill International rose 0.7 percent to $1.42.
Freightways led the index higher, rising 5.4 percent to $4.65. Sky Network Television gained 2.2 percent to $5.98.
MightyRiverPower rose 2.4 percent to $2.10, leading gains among stocks punished by concerns a change of government next year would see more regulation in power prices. Meridian Energy gained about 1 percent to $1.03, above the $1 initial price of the instalment receipts.
TrustPower edged up 0.2 percent to $6.52 and its controlling shareholder, Infratil, rose 1.3 percent to $2.29.Contact Energy rose 0.8 percent to $5.06.
"The potential formation of a Labour/Green coalition government is likely to weigh on the performance of the New Zealand equity market and is already starting to impact performance," brokerage First NZ Capital said in a note. "The re-election of the incumbent National-led government would likely be greeted positively by investors and give rise to a rebound in the market."
Stocks most likely to be negatively affected by a change of government are in the energy utilities sector such as Contact, Meridian, MightyRiverPower and TrustPower as well as those with regulatory risk including SkyCity Entertainment Group and Chorus, First NZ said.
Chorus, the network operator, fell 0.7 percent to $1.435 while SkyCity was up 1.3 percent to $3.85.