MARKET CLOSE: NZ shares fall from highs ahead of earnings; Telecom, Ryman dip
Aug. 8 (BusinessDesk) - New Zealand shares fell in the lead up to earnings season amid speculation prices have
strengthened enough already to reflect the outlook for stronger earnings. The decline was paced by Telecom, Ryman
Healthcare and Mainfreight.
The NZX 50 Index fell 3.02 points, or 0.1 percent, to 3581.79. Within the index, 22 stocks rose, 19 fell and nine were
unchanged. Turnover was $99 million.
New Zealand’s listed companies will lift normalised profit by a median 7 percent, based on Forsyth Barr’s forecasts for
43 companies that it follows. Sales are expected to rise by 3.8 percent.
"Leading into the results season people are thinking about where the numbers end up," Shane Solly, portfolio manager at
Mint Asset Management. "There is a little more profit taking - that is not surprising."
Telecom, the largest company on the exchange, fell 2.6 percent to $2.66 after rising to its highest level since August
2008 yesterday. Telecom is scheduled to release its full-year results on Aug.24. The telecommunications company's
normalised earnings are expected to rise about 37 percent to $330.2 million, according to brokerage Forsyth Barr.
Mainfreight fell 1.6 percent to $9.20 before its earnings are released tomorrow.
"People are obviously looking to see what the global slowdown has meant," Solly said. "We are seeing a bit of profit
taking ahead of that result."
Shares in Ryman Healthcare, New Zealand's largest retirement village operate, fell 1.4 percent to $3.56.
Fletcher Building, the largest listed construction company, rose 1.4 percent to $6.43.
The decline was led by Cavalier, the carpet and wool scouring group, which dropped 3.1 percent to $1.58.
Michael Hill, the listed jewellery maker, increased 2.9 percent to a $1.05, the highest in more than a month. The stock
has gained 17 percent so far this year. Pumpkin Patch, which sells children's clothing, advanced 1.1 percent to 91
cents, while Hallenstein Glasson Holdings, the clothing retailer, rose 0.5 percent to $4.28.
"It is sign consumers are feeling more confident to put their hands into their pockets - spending money on
smaller-ticket items," Solly said.
The gainers were led by OceanaGold, which operates the Macraes gold mine near Dunedin, up 7.9 percent to $2.86. Goodman
Fielder, the food manufacturer, rose 4.9 percent to 64 cents. Trade Me Group, the popular auction site, rose 1.1 percent