MARKET CLOSE: NZ shares up, Trustpower and Infratil rise while Fletcher Building gave back gains.
By Sophie Boot
Oct. 13 (BusinessDesk) - New Zealand shares gained, led by Trustpower and Infratil on earnings upgrades, while Fletcher Building gave back gains.
The S&P/NZX50 Index rose 0.3 percent, or 21.2 points, to 8,089.32. Within the index, 26 stocks rose, 16 fell and eight were unchanged. Turnover was $179 million.
Grant Davies, investment advisor at Hamilton Hindin Greene, said the stock market is unperturbed by the continued lack of government. Winston Peters has now said that the New Zealand First board will meet on Monday, after the final round of negotiations finished yesterday, but wouldn't give a deadline for a decision being made.
"The market has been through this before, it's really just boiling down to what companies are doing rather than what the government is doing," Davies said. "Stocks are being driven by momentum at the moment."
Xero, Synlait Milk and A2 Milk Co, all of which have seen strong gains over the past fortnight after positive news, continued to rise today. Xero gained 3.1 percent to $35.10; Synlait rose 0.3 percent to $7.48; and A2 advanced 0.4 percent to $7.77.
Trustpower led the index, up 3.9 percent to $5.89. It raised annual earnings guidance for a third time this financial year with strong wholesale electricity prices on both sides of the Tasman and increased generation in New Zealand, also boosting the outlook for controlling shareholder Infratil whose shares gained 1.6 percent to $3.16.
The Tauranga-based company forecasts earnings before interest, tax, depreciation, amortisation and fair value adjustments to be between $255 million and $270 million in the year ending March 31, 2018, up from a previous forecast of $225 million-to-$245 million. Infratil now sees ebitdaf of between $485 million and $525 million in the year ending March 31, 2018, up from a previous forecast of $460 million-to-$500 million.
Fisher & Paykel Healthcare rose 1.3 percent to $12.82. It is considering whether to appeal a ruling by the Regional Court in Munich that rival ResMed did not infringe its patents in one of the cases in the continuing intellectual property dispute over its face and nasal masks.
Fletcher Building was the worst performer, down 1.9 percent to $7.71, though Davies said the stock was just giving back yesterday's gains.
NPT gained 3.5 percent to 59.5 cents. The listed property investor has sold its interest in the AA Centre in central Auckland to SkyCity Entertainment Group for $47 million, as it looks to reposition the business after a board overhaul. Sky City fell 0.8 percent to $3.71.
Outside the benchmark index, Warehouse Group dropped 0.9 percent to $2.14. Founder Stephen Tindall will take a year off from the board to focus on his other commitments, especially the preparations for Auckland to host the America's Cup.
Tindall is taking a leave of absence from the board until October next year, with his son Robbie Tindall standing in as an alternate director, the retailer said in a statement. He's taking a break to focus on his commitments as Team New Zealand chair, such as securing the necessary infrastructure for Auckland's hosting of the America's Cup defence.