MARKET CLOSE: NZ shares rise to 4-year high, paced by NZX, Trade Me, Fletcher
By Hannah Lynch
Sept. 14 (BusinessDesk) - New Zealand shares rose, nudging the NZX 50 to a new four-year high, paced by the NZX, Trade Me and Fletcher Building after the Federal Reserve announced further measures to bolster growth in the world’s biggest economy.
The NZX 50 Index rose 6.3 points, or 0.2 percent, to 3792.34, the highest close since January 2008. Within the index, 23 stocks rose, 14 fell and 13 were unchanged. Turnover was $108 million.
The Federal Reserve plans to expand its holdings of long-term securities with open-ended purchases of US$40 billion of mortgage debt a month and pledged to keep interest rates at record lows until at least mid-2015. Equity markets across Asia joined a rally in US stocks following the Fed’s statement.
"The Fed stimulus and obviously with interest rates staying lower for longer means money is coming out of bank deposits into equities," said Bryon Burke, head dealer at Craigs Investment Partners.
NZX, the stock exchange regulator, rose 2.8 percent to $1.11. Fletcher Building, New Zealand's largest construction company, rose 1.6 percent to $6.80, the highest since late March. Cavalier, New Zealand's only listed carpet market, gained 1.1 percent to $1.82.
Trade Me rose 1.8 percent $4.01. On Thursday, NZX said the online auction site will replace Nuplex Industries in the NZX20, an index launched six months ago to encompass the stock exchange's 20 largest and most-liquid companies.
Nuplex Industries, the specialty chemicals maker, rose about 1 percent to $3.20. The stock has gained 38 percent so far this year.
The gainers were led by OceanaGold, who operates the Macraes goldfield near Dunedin, up 8 percent to $3.65 as spot gold climbed to US$1,774.54 an ounce, a seven-month high, following the Fed’s statement.
The decline was led by Fisher and Paykel Healthcare, which gets more than 50 percent of its revenue in US dollars. It fell 6.6 percent to $2.11 as the New Zealand dollar rose to a six-month high against the greenback.
"It’s the most highly leveraged stock on the New Zealand market" to the currency, Burke said. "It's now just about one of the worst performing stocks on the NZX 50."
Fisher and Paykel Appliances fell 0.4 percent to $1.175, having soared this week in the wake of Chinese-based Haier’s proposal to buy the 80 percent of the company it doesn’t already own for $1.20 a share.
Telecom, the largest company on the exchange, fell 0.6 percent to $2.48.
Windflow Technology, the wind turbines manufacture, was unchanged at 17 cents and has shed 47 percent this year. It missed the deadline for filing its annual results yesterday, saying a director is overseas, and has told the stock exchange it will file the report on Monday.