MARKET CLOSE: NZ stocks fall; Wrightson, NZS drop

MARKET CLOSE: NZ stocks fall as U.S. earnings season gets underway; PGW, NZS fall

By Jason Krupp

July 13 (BusinessWire) – New Zealand stocks fell for the first time in eight sessions, tracking Asian markets lower with all investors remaining cautious ahead of the key company reporting season in the U.S. PGG Wrightson and NZ Farming Systems Uruguay paced the slide.

The NZX 50 fell 3.1 points, or 0.1%, to 3008.9. Within the index 24 stocks fell, 13 rose and 13 remained unchanged. Turnover was $86.3 million.

Japan’s Nikkei was last trading at 0.2% down at 9,528.3, Hong Kong’s Hang Seng Index was 0.1% down at 20454.8 and Singapore’s Strait Times Index was 0.2% weaker at 2920.7.

Ricky Ward, domestic equities manager at Tyndall Investment Management said markets were shrugging off early indications of better-than-expected company result from the U.S. after Alcoa Inc., the largest U.S. aluminum producer, reported second-quarter earnings that topped analysts’ projections on the back of stronger metal prices.

“The data coming out is not conclusive that we are going to get a quick turnaround, and that uncertainty has created the market that we have at the moment, with light flows and a high level of caution,” Ward said. “We have just hit the start of reporting season in the States, and it may be a bit premature for people to speculate from one company in particular what the overall results will be.”

Wrightson, the rural services company, fell 3.9% to 49 cents. The stock has come under pressure after the company announced last week that its finance unit is looking to extend the maturity of a listed bond due in October for another year after it was accepted into the government's extension to the retail deposit guarantee.

Farming Systems, the South America-based dairy farm operator, fell 4.6% to42 cents, pacing declines, NZX Ltd., the New Zealand stock market, fell 1.9% to $1.57, and Fisher & Paykel Appliance Holdings Ltd., the whiteware manufacturer, fell 1.8% to 54 cents.

Shares in Telecom Corp rose 0.5% to $1.96 as speculation swirls that the company is nearing the sale of i AAPT, the telecommunication company’s Australian unit. Ward said sale has helped offset news that Telecom would incur $38 million more in tax expenses in 2010, following changes to New Zealand’s tax law stopped companies claiming depreciation on buildings.

Pyne Gould Corp. rose 2.6% to 40 cents, pacing gains on the NZX 50. Sky City Entertainment Group Ltd., casino and hotel operator, rose 1.4% to $2.95 and Kiwi Income Property Trust, the retail and commercial property investor, rose 1.1% to 93 cents.

Contact Energy Ltd. fell 0.3% to $5.80 %. The electricity supply and distribution company had earlier announced that it had won an $8 million contract to supply electricity to the New Zealand Defence Force. The contract is for three-years, with two further rights of renewal for a period of two years each.

Diligent Board Member Services inc. a start-up software company, rose 1.6% to 64 cents after reporting second-quarter sales jumped 66% to US$1.92 million in what is traditionally a slow period. That took annualised licence fees – locked-in recurring revenues – to US$7.55 million compared with US$4.89 million at the end of the second quarter last year.

Shares in dual-listed APN News & Media Ltd. were unchanged at $2.43 after the company’s chief executive Brendan Hopkins announced that he is stepping down at the end of the year. Hopkins has led the Australasian media company for eight years.

The government-appointed statutory manager over Timaru millionaire Allan Hubbard and part of his empire has frozen the assets of another investment vehicle, saying it has “added another complexity” to the investigation.

Three weeks after their appointment, Richard Simpson and Trevor Thornton of Grant Thornton have frozen Hubbard Management Funds, another Hubbard-controlled investment vehicle, which shares some investors with Aorangi Securities Ltd., according to the first statutory managers’ report.

(BusinessDesk)

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