MARKET CLOSE: NZX 50 Edges Higher
MARKET CLOSE: NZX 50 Edges Higher; Rakon up, Nuplex
Nov. 26 – New Zealand stocks were mixed, with the NZX 50 Index ending higher for the second day, as stocks that had led the preceding six-day rout, Rakon and Pumpkin Patch, extended their gains.
The NZX 50 edged up 0.1% to 2637.90, adding to yesterday’s 2.3% gain. Within the index, 23 stocks fell, 17 gained and nine were unchanged. The index is down almost 5% since Nov. 14. Rakon rose 6.3% to NZ$1.19, having sunk to NZ$1 last week, below its 2006 IPO price of NZ$1.60.
The company, which makes components used in navigation systems, may be a good medium-term buy, according to First NZ Capital. “If you believe markets can get through the next six months or so, Rakon had potential to gain a lot of ground,” said Barry Lindsay, research manager. The company, which cut its outlook for earnings this month, also benefits from a weaker New Zealand dollar, he said.
Nuplex Industries dropped 11% to NZ$3.40 after lowering its earnings forecast just three weeks after it made the prediction at its AGM. The shares have fallen 45% this year and are “quite cheap but they’re going to stay that way,” Lindsay said.
“It’s a bottoming out process,” Lindsay said of the global stock slump this month. “I just can’t believe things can get a heck of a lot worse.”
Australia’s S&P/ASX 200 Index was down 2.2% to 3540. Rio Tinto led the decline, tumbling 33% percent after BHP Billiton dropped its takeover bid. Rio may have the rating cut on US$5 billion of debt because of a slump in prices of the raw materials it produces, according to Moody’s Investors Service.
Qantas Airways fell 3.3% after Moody’s said it may lower its rating. In Tokyo, the Nikkei 225 Index fell 1.3% to 8213.22 in mid-day trading.
Air New Zealand fell 2.3% to 85 cents after the U.K. announced it would impose a tariff on long-haul air tickets to destinations such as New Zealand. Prime Minister John Key protested to British PM Gordon Brown during their meeting.
National Property Trust gained 7.7% to 42 cents after the investor said its distributable surplus in the first half rose 14% to $4.78 million. A decline in the value of its properties contributed to a first-half net loss.
Lyttelton Port Co. was unchanged at NZ$2.69.
Hamilton Hindin Greene told the NZX it has completed its stand in the market for 2.5 million shares in the port company at NZ$2.75 apiece on behalf of Christchurch City Holdings.