MARKET CLOSE: NZ share rise; Telecom paces gainers on UFB announcement
By Jason Krupp
Dec. 13 (BusinessDesk) - New Zealand stocks rose with Telecom Corp. accounting for much of the activity on the exchange today after it was tipped as one of the prioritised bidders to build government's ultrafast broadband network.
The NZX 50 Index rose 18.37 points, or 0.6%, to 3,291.28. Within the index, 28 stocks rose, eight fell and 14 were unchanged. Turnover was $59.3 million.
Telecom, the country's biggest telephone company, rose 1% to $2.10, after Crown Fibre Holdings earmarked it as a forerunner for the rollout of broadband infrastructure in 25 regions, including the all-important Auckland market after earlier missing out on the first round of prioritised bids.
Enabled Networks was selected as the lead bidder for Christchurch and Rangiora, while Flute JV represented by Aurora Energy Ltd. will cover Dunedin. Northland and Central North Island areas were already awarded to Ultrafast Fibre Ltd. and Northpower Ltd. last week.
"It is a net positive but the market had been expecting this kind of announcement, so the response has been reasonably muted," said Craig Brown, who helps manage $1.1 billion in equities for One Path New Zealand. "If they didn't get it we would have seen a much bigger reaction."
Vector Ltd., the country's largest listed network utility company competing Telecom for the Auckland UFB tender, fell 2.5% to $2.35 after it missed be selected as a prioritised bidder.
Pumpkin Patch Ltd., the children's clothing retailer, rose 5.5% to $1.75, leading gainers on the NZX 50. Rakon Ltd, the maker of crystal oscillators used in cellphones and GPS units, rose 1.7% to $1.20, and Westpac Banking Corp., the Australian lender, rose 2.2% to $30.20.
Auckland International Airport Ltd. rose 1.5% to $2.10 after the country's busiest gateway added another international route to its list of destinations with confirmation that China Southern Airlines will start flights to Auckland from Guangzhou via Melbourne in April.
Sanford Ltd., the fisheries group, fell 2.8% to $4.60, leading decliners on the index.
New Zealand Oil & Gas Ltd., the energy exploration and production company that owns a 19% stake in Pike River Coal Ltd., fell 2.3% to 87 cents after announced that has place Pike in receivership following series of explosions at its West Coast that killed 29 and shut production. The announcement saw trading in Pike River suspended until further notice.
"No doubt there is a good coal seam in there, now the issue is of course how much to get it out and who is going to front up with that," Brown said.
Bathurst Resources Ltd., which is looking to establish a series of coalmines on the West Coast, rose 2.2% to 92 cents.
New Zealand Farming Systems Uruguay Ltd., the South American dairy operator bought out by Singapore’s Olam International Ltd., was unchanged at 58 cents after chief executive Alastair de Raadt said he will not renew his contract when it expires on Jan. 31 next year. De Raadt, who was already based in Uruguay, was appointed in September.