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MARKET CLOSE: NZ shares fall as investors raise funds for Z

MARKET CLOSE: NZ shares fall as investors raise funds for Z; Trade Me, Fletcher drop

Aug. 19 (BusinessDesk) – New Zealand shares fell as some investors sold down their portfolios to raise fund for the Z Energy float and amid positioning ahead of earnings this week. Auction website Trade Me and Fletcher Building paced the decline.

The NZX 50 Index fell 10.655 points, or 0.2 percent, to 4503.222. Within the index, 18 stocks fell, 17 rose and 15 were unchanged. Turnover was $158 million.

Z Energy ended its first day of trading at $3.66, a 4.6 percent gain from its initial public offering price of $3.50 as owners Infratil and the New Zealand Superannuation Fund sold 60 percent of their holding. Infratil ended the day unchanged at $2.46.

“The previous owners of the stock have done a really good job getting the deal away at an appropriate price,” said Mark Warminger, portfolio manager at Milford Asset Management. “We’ve seen some selling in the market to raise funding for Z and I think the market is positioning for earnings this week as well.”

Trade Me, which posts its full-year results on Wednesday, fell 2.3 percent to $4.70, with 6 million shares changing hands. The company may post annual profit of $77.6 million, up from $75.6 million a year earlier, according to First NZ Capital.

Fletcher Building, which also reports its annual results on Wednesday, declined 1.4 percent to $8.20, with 1.95 million shares changing hands. Argosy Property dropped 2 percent to 96 cents.

Steel & Tube Holdings climbed 3.9 percent to $2.66 following its results last week, which showed full-year profit rose 19 percent. First NZ Capital, which rates the stock ‘outperform’, said it will be a beneficiary of the recovery in the New Zealand building and construction sector.

“Steel & Tube is much better positioned that it has been and it’s at the bottom of the cycle,” Warminger said.

Michael Hill International, which posted a 9.6 percent gain in full-year profit last Friday as new stores boosted sales, rose 5.8 percent to $1.45.

Shares in NZX rose 0.7 percent to $1.40 after the stock exchange operator reported a doubling in first-half profit to $6.4 million on the growing number of companies listing on the bourse and increased trading activity.

Cavalier Corp jumped 9.3 percent to $1.53, recovering from a sell off on Friday when it reported annual underlying earnings of $6.6 million, near the bottom of forecast guidance.

Among companies reporting tomorrow, Ebos Group was unchanged at $9.70, Chorus fell 0.7 percent to $2.88, Contact Energy gained 1.9 percent to $5.30 and Precinct Properties declined 1 percent to $1.02.

Listed Wellington building owners said none of their properties sustained any serious structural damage after Friday’s 6.5 magnitude earthquake near Seddon in the South Island. Property for Industry declined 1.5 percent to $1.35, DNZ Property Fund was unchanged at $1.665, Goodman Property Trust was unchanged at $1.05 and Kiwi Income Property Trust held at $1.17. Insurer Tower was unchanged at $1.69.


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