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

 


MARKET CLOSE: NZ shares gain, led by Xero

MARKET CLOSE: NZ shares gain, led by Xero

By Tina Morrison

July 25 (BusinessDesk) - New Zealand shares rose, led by Xero after investors gained confidence about the cloud-based accounting software firm's US expansion plans following upbeat comments at the company's annual meeting this week.

The NZX 50 Index rose 19.556 points, or 0.4 percent, to 5,194.268. Within the index 21 stocks rose, 18 fell and 11 were unchanged. Turnover was $121 million.

Xero advanced 5.7 percent to $25.90. The stock has gained 9.8 percent since its annual general meeting in Wellington on Wednesday when chief executive Rod Drury was upbeat about the company's prospects in the US, where it faces a battle with the incumbent accounting software provider Intuit. Drury belaboured not only a belief that Xero's cloud-based product suite is outgunning Intuit's attempts to move into the cloud, but also that the company will benefit from establishing strong positions in the Australian and UK markets before embarking on the US.

"Post their AGM, Xero has continued to improve," said Grant Williamson, a director at brokerage Hamilton Hindin Greene. "The AGM presentation just gave investors a little bit more confidence that the company is on the right track, particularly in America, so that's created a bit of buying in the stock."

Telecom Corp, New Zealand's largest telecommunications provider, rose 0.7 percent to $2.954, its highest level since May 2008. The stock has gained 9.6 percent so far this month as investors favour yield stocks over growth stocks in anticipation the Reserve Bank will keep interest rates on hold for a period after hiking the benchmark yesterday for its fourth consecutive meeting this year.

"Telecom continues to grind its way higher," said Williamson. "That's been one of the better performing stocks in recent times. Investors now realise that interest rates are not going to go up too much more in the short term and therefore they are starting to come back and look at yield stocks on the market."

Demand for yield is pushing up property stocks and weakening growth stocks such as retirement village operators, Williamson said.

Kiwi Income Property Trust gained 1.3 percent to $1.195, Precinct Properties New Zealand rose 1.4 percent to $1.11, Property For Industry increased 1.1 percent to $1.36 and Goodman Property Trust advanced 0.5 percent to $1.075.

"Investors are turned off a little bit by the higher risk growth stocks and are now really looking more towards the defensive income stocks," said Williamson. "Retirement village stocks are under a bit of pressure as well mainly because they don't pay much in the way of income, they are considered growth stocks. We are seeing investors making a bit of a switch from growth to income."

"It is really an interest rate story with the Reserve Bank saying we will pause and review things a bit later on," he said. "Investors have come to the conclusion that in the short term, interest rates don't go any higher."

Ryman Healthcare slipped 1 percent to $8.06, while Metlifecare fell 2.1 percent to $4.19 and Summerset Group Holdings was unchanged at $3.12.

Meanwhile, debut stock Scales Corp closed weaker at $1.58, having first traded at $1.61, largely flat compared to the fruit and logistics company's $1.60 IPO price. Some 2.7 million shares of the company’s 139.8 million shares on issue changed hands.

"It was a pretty muted first day trading," said Williamson, adding the company is probably affected by some IPO fatigue in the market and current sentiment favouring defensive stocks rather than riskier companies such as Scales whose apple growing operations could be affected by weather and growing conditions.

Port of Tauranga rose 0.3 percent to close at a record high $15.85 as investors acquired more of the utility stock after it said earlier this month it had won a slot in Maersk's Southern Star service from Ports of Auckland, cementing its place as New Zealand's biggest container port.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Broadband Network: Spark Launches New, Competitive Ultra Fibre Plan Line-Up

Spark is giving customers an even more compelling reason to switch to its Ultra Fibre plans from today with the introduction of new competitive pricing for the majority of its plans (details below) and Fibre Landline (voice-over-fibre technology) for ... More>>

Employment: ANZ Proposes Casualisation In Whangarei Stores

ANZ workers in Whangarei could see their incomes drop by 20 to 40 percent if the bank’s proposal to reduce the number of full-time positions goes ahead says FIRST Union national organiser Tali Williams. More>>

Finance: BNZ Develops Specialist Tāmaki Māori Banking Team

BNZ develops specialist Tāmaki Māori Banking Team to support Māori as Auckland grows More>>

Pharmaceuticals: Commerce Commission To Consider Pharmaceuticals Merger

The Commerce Commission has received an application from Pfizer Inc. seeking clearance to acquire all of the shares in Hospira Inc. More>>

Real Estate: Housing Unaffordability Issues Spread

Surging house prices in Auckland and Queenstown last month pushed home ownership even further beyond the reach of first home buyers in the two districts, according to the AMP360 Home Loan Affordability Report for March. More>>

Statistics NZ: Annual Exports To China Dip Below Australia

The value of goods exports to Australia ($8.7 billion) surpassed those to China for the year ended March 2015, Statistics New Zealand said today. More>>

Science: Hookworm Discovery At Malaghan Institute

Professor Graham Le Gros has led a team which has stimulated both innate and memory responses to the parasite, discovering along the way the unexpected behaviour of one particular immune cell, in Hookworm, one of the world’s most devastating tropical ... More>>

Business: Provinces Urged To Make Full Use Of New Air Services

Provincial New Zealand has been urged to use new air services to Auckland or risk losing them either partially or completely. The stark warning was issued today by Far North mayor John Carter at a ceremony at Kaitaia airport to mark the final Air ... More>>

Mobile: 2degrees To Credit All Calls And SMS To Nepal

In the wake of the devastating earthquake in Nepal in the weekend, 2degrees will be crediting all calls and SMS messages made to mobiles and landlines in Nepal from Friday 24th April until midnight Wednesday 29th April. More>>

Scoop Business: Alex Swney Pleads Guilty To $2.5M Fraud Charge

Alex Swney, former chief executive of the Auckland city centre business association Heart of the City, has pleaded guilty to dishonestly using documents to obtain $2.5 million. More>>

ALSO:

Petrol Burns Prices: Second Consecutive Quarterly Fall For CPI

The consumers price index (CPI) fell 0.3 percent in the March 2015 quarter, following a 0.2 percent fall in the December 2014 quarter, Statistics New Zealand said today. The last time the CPI showed two consecutive quarterly falls was in the December 1998 and March 1999 quarters. More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news