MARKET CLOSE: NZ stocks mixed; Restaurant Brands falls

MARKET CLOSE: NZ stocks mixed; Restaurant Brands paces decliners, NZX gains

By Jason Krupp

Jan. 24 (BusinessDesk) - New Zealand stocks were mixed ahead of the Reserve Bank's interest rate announcement later this week. Restaurant Brands NZ Ltd. paced decliners on the exchange while NZX Ltd. rose.

The NZX 50 Index fell 0.06 points, or 0.002%, to 3352.65. Within the index, 15 stocks fell, 14 rose, and 21 were unchanged. Turnover was $65 million, with Wellington market participants away for the anniversary day holiday.

Reserve Bank Governor Alan Bollard will likely keep the Official Cash Rate unchanged at 3% this week, according to a Reuters survey of 20 economists. The market is betting interest rates will remain on hold until the third quarter to allow New Zealand's economy to recover after narrowly avoiding a double-dip
recession last year.

Restaurant Brands, the fast food franchise owner, fell 2.7% to $2.51. The stock was second best performer on the NZX 50 last year, gaining 64% over the past 12-months, but has battled to find traction this year, and is now trading at its lowest level since Oct 19.

PGG Wrightson Ltd., the rural services company, fell 1.9% to 52 cents after Agria dispatched its formal takeover offer to shareholders today. The Singapore-based agricultural and seeds researcher, supported by China's New Hope Group, is looking to boost its holdings in Wrightson to just over half, with an offer of 60 cents a share.

Air New Zealand Ltd, the national carrier, was unchanged at $1.42 after rating agency Moody's Investor Service said the airline's decision to get into the Australian market by buying a 15% stake in Virgin Blue Holdings is likely to weaken its credit profile.

"Qantas is not as strong as they once were, which might be why they want to lock in benefits they get from a closer alliance with Virgin," said Craig Brown, who helps manage $1.1 billion in equities for One Path New Zealand.

APN News & Media, which publishes the New Zealand Herald and operates the Radio Network, was unchanged at $2.40. The company today said the Queensland flood will probably have minimal impact on its bottom line due to the diversified nature of its business in the Australasian region.

APN however said that while it expects the Queensland economy to rebound rapidly in the wake of the disaster, advertising revenues from small businesses, retailers and real estate are expected to remain under pressure, having already shown some signs of weakness ahead of the floods.

Telecom Corp., New Zealand's biggest telephone company, was unchanged at $2.31, having dominated trading on the day with 11.6 million shares changing hands. Brown said the lack of price movement was probably due to an internal reshuffle of assets by a single fund manager rather than a play on the open market.

NZX, the securities market operator, rose 1.8% to $1.71, pacing gainer on the NZX 50.

Goodman Fielder Ltd., the Australian food ingredient manufacturer, rose 1.8% to $1.74. The company said last week that its Queensland operations had largely been left unaffected by the floods, and full operations would be restored shortly.

Michael Hill International ltd., the jewellery maker and retailer, rose 1.1% to 90 cents. Durante Holdings, which represents the founding Hill family, is looking to buy a 5% stake in the company at the current price, and if successful, would give it control over the company with a 50.2% shareholding.

(BusinessDesk)

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