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

 


MARKET CLOSE: NZ shares rise on economic momentum

MARKET CLOSE: NZ shares rise on economic momentum, Telecom, Air New Zealand rise

By Suze Metherell

May 12 (BusinessDesk) – New Zealand shares rose on expectations forecasts in Thursday’s budget will add to confidence about the pace of economic growth. Air New Zealand and Telecom paced the advance.

The NZX 50 Index rose 9.754 points, or about 0.2 percent, to 5162.423. Within the index, 19 stocks rose, 17 fell and 14 were unchanged. Turnover was $125 million.

Air New Zealand led the market higher, gaining 3.3 percent to a six-and-a-half-year high of $2.20. Last November the government sold down 20 percent, reducing its stake in the national carrier to about 54 percent and boosting liquidity in the stock. Since then the shares have climbed about 40 percent, buoyed by strong earnings and its dominance in the domestic market.

“Since the government sold down some time ago the share price has continued to rise to levels not seen for a very long time,” said Grant Williamson, director at Hamilton Hindin Greene. “It’s quite a good story for investors, and given most airlines around the world are underperforming I think it’s a fair credit to Air New Zealand and does indicate the almost-monopoly they do have in the New Zealand domestic market.”

Telecom rose 0.6 percent to $2.64 and was the most-traded stock, with 12.8 million shares changing hands. New Zealand’s largest telecommunications provider is favoured by investors looking for exposure to New Zealand and for its 6.3 percent dividend yield, Williamson said.

“What has created buying in our market for quite some time now is our economic outlook,” Williamson said, who expected Thursday’s budget to confirm further growth in the economy.

Energy stocks were mixed. Contact Energy rose 0.4 percent to $5.50. Meridian Energy advanced 0.4 percent to $1.20.Vectoer, the Auckland lines company, was the day’s worst performer down 2 percent to $2.49 while MightyRiverPower slid 1.8 percent to $2.225.

Recent political polls have called into doubt the presumption the National-led government will return for a third term after September’s election. The main opposition parties, Labour and Greens, want to re-regulate the energy sector, creating a state-owned central buyer to push down consumer electricity bills.

“Investors in the electricity generators will really be waiting for the next lot of election poll results to determine how things are tracking. That sector is likely to remain volatile as we head into the election,” Williamson said.

Fletcher Building, New Zealand’s largest listed company, was unchanged at $9.32. Xero, the cloud-based accounting firm, climbed 1.4 percent to $30.62.

Infratil, the infrastructure investor, advanced 1.1 percent to $2.29 ahead of reporting its earnings tomorrow. Trustpower, which is majority owned by Infratil, was unchanged at $7.05. The electricity generator and retailer reported a drop in full year profit last week, as it chased growth in its Australian windfarms to offset a drop in New Zealand sales.

Ryman Healthcare fell 0.5 percent to $8.64. The retirement village operator is due to report earnings this week, which Williamson said are expected to be strong but are already priced in.

Auckland International Airport advanced 1 percent to $4.12 after New Zealand’s busiest gateway announced it plans to raise $150 million through a seven-year bond issue.

Units in Fonterra Shareholders’ Fund were unchanged at $6.00 after Fonterra Cooperative Group said the gap between cheese and milk powder prices had lessened, reducing pressure on its margins. The units give investors access to the dividend stream.

Skellerup Holdings, the industrial rubber maker, rose 0.6 percent to $1.71. A substantial shareholder’s notice showed Milford Asset Management had upped its holding in the stock to 9.6 percent.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Company Results: Air NZ Rides The Tourism Boom With Record Full-Year Earnings

Air New Zealand has ridden the tourism boom and staved off increased competition to deliver the best full-year earnings in its 76-year history. More>>

ALSO:

New PGP: Sheep Milk Industry Gets $12.6M Crown Funding

The Sheep - Horizon Three programme aims to develop "a market driven, end-to-end value chain generating annual revenues of between $200 million and $700 million by 2030," according to a joint statement. More>>

ALSO:

Half Full: Fonterra Raises Forecast Milk Price

Fonterra Co-operative Group Limited today increased its 2016/17 forecast Farmgate Milk Price by 50 cents to $4.75 per kgMS. When combined with the forecast earnings per share range for the 2017 financial year of 50 to 60 cents, the total payout available to farmers in the current season is forecast to be $5.25 to $5.35 before retentions. More>>

ALSO:

Keep Digging: Seabed Ironsands Miner TransTasman Tries Again

The first company to attempt to gain a resource consent to mine ironsands from the ocean floor in New Zealand's Exclusive Economic Zone has lodged a new application containing fresh scientific and other evidence it hopes will persuade regulators after their initial application was turned down in 2014. More>>

Wool Pulled: Duvets Sold As ‘Premium Alpaca’ Mostly Sheep’s Wool

Rotorua business Budge Collection Limited (Budge) and sole director, Sun Dong Kim, were convicted and fined a total of $71,250 in Auckland District Court after each pleading guilty to four charges of misrepresenting how much alpaca fibre was in their duvets. More>>

Reserve Bank: Labour Calls For Monetary Policy To Expand Goals

Labour's comments follow a speech today by RBNZ governor Graeme Wheeler in which Wheeler sought to answer critics who variously say he should stop lowering interest rates, lower them faster, or that inflation-targeting should no longer be the primary goal of the central bank's activities. More>>

ALSO:

BSA Extension And Sunday Morning Ads: Digital Convergence Bill Captures Online Content

Broadcasting Minister Amy Adams has today announced the Government’s plans to update the Broadcasting Act to better reflect today’s converged market... The Government considered four areas as part of its review into content regulation: classification requirements, advertising restrictions, election programming and contestable funding. More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news