MARKET CLOSE: NZ shares heading for 2.5% gain in October despite election; Scales, Synlait, A2 gain
By Sophie Boot
Oct. 30 (BusinessDesk) - New Zealand shares rose, buoyed by exporters Scales Corp and Synlait Milk, while Mainfreight and Air New Zealand fell as investors weigh up possible policy changes from the new government.
The S&P/NZX 50 Index gained 58.99 points, or 0.7 percent, to 8,143.98. Within the index, 30 stocks rose, 14 fell and six were unchanged. Turnover was $144 million.
"On the day the volumes are quite light, but the tone's still positive," said Shane Solly, director, portfolio manager at Harbour Asset Management. "We've had a period where people have been absorbing policy change, and we have seen companies more exposed to the domestic economy underperform. That's people looking at what happens with a different type of growth and favouring those with more of an overseas earning base.
"There's lots for investors to think about, the sun has come up and the market has come up with it. We're going to end up higher than we were at the start of the month by quite some way - 2.5 percent, which is really a pretty solid performance in the scheme of things," Solly said.
Scales Corp led the index, up 4.6 percent to $3.88. Solly said offshore earners like Scales, Synlait Milk and A2 Milk had bounced on continued currency weakness. Synlait rose 3.5 percent to $8.24 and A2 gained 1.7 percent to $8.75.
Tourism Holdings advanced 1.6 percent to $5. Chinese investment manager Citic Capital, which oversees US$21 billion of assets, has boosted its stake in the motorhome operator to almost 11 percent having emerged as a substantial shareholder earlier this month.
Mainfreight was the worst performer, dropping 1.3 percent to $24.24. Air New Zealand fell 1 percent to $3.35 and Sky Network Television dipped 0.8 percent to $2.58.
Outside the benchmark index, New Zealand Oil and Gas gained 0.7 percent to 71 cents. Shareholders had mixed views on the partial takeover offer from OG Ofer at the company's annual meeting in Wellington on Monday morning. A substantial product holder notice from OG showed it held 19.5 percent of the shares.