MARKET CLOSE: NZX 50 hits record again; Fletcher, Port of Tauranga advance
By Suze Metherell
March 4 (BusinessDesk) – New Zealand’s NZX 50 Index rose to a record for a second day as investors were drawn to a market with robust economic growth and corporate earnings on the other side of the planet from rising tensions in Ukraine. Fletcher Building and Port of Tauranga paced the gains.
The NZX 50 rose 25.857 points, or about 0.5 percent, to 5033.261. Within the index, 28 stocks rose, 16 fell and six were unchanged. Turnover was $103.8 million.
Fletcher, New Zealand’s largest listed company, rose 1.1 percent to $9.55, while Port of Tauranga, the busiest export port, rose 2.5 percent to $14.50. Figures yesterday showed the nation’s terms of trade rose to a 40-year high in the fourth quarter, while both companies lifted their dividend payments.
“We had terms of trade out yesterday which was strong and we’re just finishing reporting season so we’ve got good New Zealand companies that are showing their balance sheets are in good shape, all about to pay their dividends,” said Paul Valk, investment advisor at Craigs Investment Partners.
“Why would you bail out of good companies because of something that’s happening on the other side of the world, that’s not going to affect New Zealand,” Valk said of the standoff between Russia and Ukraine.
Auckland International Airport rose 0.8 percent to a record high of $3.78. Air New Zealand extended gains, rising 0.8 percent to $1.815, a six-year high, while Sky Network Television rose 2.6 percent to $6.35, a four-month high.
Outdoor clothing chain Kathmandu climbed 5.2 percent to $3.46, leading the day’s gainers
“They dipped from nearly a $4 high, but are now recovering,” Valk said. “People are seeing they’re producing a good product, robust profits and a company that’s presenting itself well with good management and good prospects.”
Chorus rose 1.3 percent to $1.54. The network operator is in negotiations with Crown Fibre Holdings over the pricing of New Zealand’s ultrafast broadband network and will be forced to cut prices on its copper network by the Commerce Commission.
“There’s certainly been a few research reports where companies have increased their rating, perhaps from underweight to a neutral stance, if not towards the buy side,” Valk said. “People can see it is still going to be needed and perhaps the government would assist if anything went wrong.”
Restaurant Brands New Zealand was the day’s worst performer, falling 4.4 percent to $2.80. Telecom fell 1 percent to $2.485. SkyCity Entertainment Group was unchanged at $3.93.