MARKET CLOSE: NZ stocks rise on Fed stimulus hopes

MARKET CLOSE: NZ stocks rise on Fed stimulus hopes

by Jason Krupp

Sept. 21 (BusinessDesk) - New Zealand stocks rose as investors' appetite for higher yielding, riskier assets lifted on hopes the U.S. Federal Reserve will unveil further monetary stimulus tomorrow. OceanaGold Corp. led gainers, and New Zealand Oil & Gas Ltd. fell.

The NZX 50 Index rose 18.21 points, or 0.6%, to 3,308.83, its first gain in three sessions.

Within the index, 20 stocks rose, 12 fell, and 18 were unchanged. The kiwi dollar was little changed at 82.28 U.S. cents at 5pm from 82.25 cents at 8am, and was up from 82.11 cents yesterday.

The majority of Asia Pacific sharemarkets rose in afternoon trade amid bets Fed chairman Ben Bernanke will launch 'operation twist' at the federal Open Market Committee meeting tomorrow, a policy aimed at lowering long term interest rates in order to support business and mortgage borrowing.

The Fed meeting comes ahead of New Zealand’s second quarter GDP data, which is expected to show the economy grew 0.5% in the three months through June.

"We're being lifted by what happened overseas, with London up very strongly and the U.S. market just about holding at the breakeven level," said Alan Moore, an executive director at Milford Asset Management.

"The New Zealand market also doesn't look that bad on yields and the results from companies, while not fantastic, were okay.

"OceanaGold Corp., the dual-listed gold miner, rose 4% to $3.41 with the stock's recent inclusion into the NZX 50 benchmark forcing fund managers who track the index to increase their holdings in the company.

Heartland New Zealand Ltd., the financial services company looking to transform itself into a bank, rose 3.9% to 53 cents.

SkyCity Entertainment Group, the casino and hotel operator, rose 2% to $3.52, with the company's 7.1% gross dividend yield and an estimated $20 million revenue boost from the Rugby World Cup attracting investors, Moore said.

Telecom Corp., the phone company looking to split its network and retail businesses, rose 1.2% to $2.60 after it sweetened its offer to bond holders owed $541 million in a bid to get the proposed demerger over the line.

The company raised the fee on offer to its Telebond holders to 0.5% from 0.25% previously, and committed to topping up annual interest payments by 0.5 percentage points if its credit rating is cut below the 'A' band.

Kathmandu Holdings, the outdoor clothing and equipment maker, rose 0.5% to $2.20 after it delivered a full-year net profit of $39.1 million.

NZ Oil & Gas, the energy exploration and production company, fell 4.3% to 67 cents, leading decliners on the exchange. Uncertainties surrounding the Pike River Coal Ltd. receivership are weighing on the stock, Moore said.

Port of Tauranga, the country's biggest export hub, fell 2.2% to $9.54 after it shed its 21 cent a share final dividend.

Guinness Peat Group, the investment company looking to wind itself down, fell 0.8% to 61 cents.Tower Ltd., the general insurer controlled by GPG, fell 0.7% to $1.46.

(BusinessDesk) 17:53:51

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