MARKET CLOSE: NZ shares fall, led by ANZ, Westpac, Fletcher

MARKET CLOSE: NZ shares fall, led by ANZ, Westpac, Fletcher; Heartland gains

June 5 (BusinessDesk) – New Zealand shares fell, as disappointing Australian growth data added to selling pressure from offshore investors spooked by a weak currency. Westpac Banking Corp, Australia & New Zealand Banking Group and Fletcher Building dropped.

The NZX 50 Index fell 20.19 points, or 0.5 percent, to 4453.58. Within the index, 29 stocks fell, nine rose and 12 were unchanged. Turnover was $133 million.

Australia’s economy grew 0.6 percent in the first quarter, missing some forecasts, while the Australian dollar has declined from above US$1 to around 96.40 US cents in the past month

Investors spurned the Australian dollar after Bureau of Statistics figures showed the economy grew at a pace of 0.6 percent in the first three months of the year, short of the 0.8 percent expansion predicted. The kiwi dollar has dropped to about 80 cents from 85 cents in the same period.

Westpac fell 3.3 percent to $33.85 and ANZ Bank declined 3.6 percent to $32.75, tracking their ASX-listed shares as the S&P/ASX 200 Index sank about 1 percent in late trading. Fletcher fell 1.5 percent to $1.29 even as figures showed a gain in the volume of building work put in place in New Zealand.

“Both the New Zealand and Australian markets are being sold off to some degree,” said Grant Williamson, a director at Hamilton Hindin Greene. Even with the weakness in the currencies “a number of foreign investors would still have profits so we’re seeing some of that” selling.

Heartland New Zealand rose 6.3 percent to 84 cents, the highest since February 2011 after the company said it would take an upfront charge against distressed assets, slashing profit this year while allowing a strong recovery in 2014.

“There’s a bit of short-term pain as they look to remove bad loans from their balance sheet,” Williamson said. “Investors like the 2014 guidance they provided. The fundamentals don’t look too bad.”

Lines company Vector fell 0.4 percent to $2.88 after Electricity Authority chairman Brent Layton told a media briefing proposals to overhaul how transmission pricing is shared will stay a top priority for the regulator, but won’t be pursued with such urgency. Electricity generator and retailer MightyRiverPower fell 0.9 percent to $2.34, while Contact Energy dropped 1.2 percent to $5.05 and TrustPower increased 0.6 percent to $7.34.

Dorchester Pacific gained 3.3 percent to 31 cents after investors exercised 134 million of 150 million options into shares at 12.5 cents apiece, meaning it won’t have to raise as much new capital in a placement. The financial services firm will ask its major shareholders whether they are willing to sell down their stakes into the placement, it said.

Units in the Fonterra Shareholders’ Fund fell 1.1 percent to $7.54 after dairy prices fell 5.3 percent at today’s GlboalDairyTrade auction. A2 Corp, which markets milk products with a protein variant claimed to have health benefits, rose 1.5 percent to 70 cents.

Argosy Property fell 1 percent to $1.01 after the property investor said it’s agreed to buy the main Auckland distribution warehouse for supermarket chain Progressive Enterprises for $74 million.

Air New Zealand fell 0.3 percent to $1.47 after it backed down on a court challenge to a settlement deal with the Commerce Commission over the long-running air cargo cartel. Air NZ has agreed to pay as yet unspecified costs to the regulator and the two sides have sought a penalty hearing, according to a joint statement from the airline and the regulator.

Ryman Healthcare fell 1.4 percent to $6.47, DNZ Property Fund declined 1.5 percent to $1.645 and Kathmandu rose 1.5 percent to $2.70 after the three stocks shed their rights to upcoming dividend payments.

(BusinessDesk)

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