MARKET CLOSE: NZ shares drop as global markets retreat
By Suze Metherell
Jan. 30 (BusinessDesk) – New Zealand shares fell today, as global markets reacted to news of another cut in US monetary
stimulus and investors eyed emerging markets nervously.
The NZX 50 Index fell 32.881 points or about 0.7 percent to 4849.842. Inside the index 30 stocks dropped, 11 rose and
nine were unchanged. Total turnover for the day was $ 78.7 million.
Across the region markets were weighed on by news of the US Federal Reserve further trimming its bond buying programme,
which has been propping up riskier assets such as stocks. Asian stock-markets followed Wall Street lower, with Japan’s
Nikkei 225 Index down 3.3 percent in afternoon trading. Hong Kong’s Hang Seng Index dropped 1.4 percent and Australia’s
S/ASX 200 Index slid 0.9 percent.
“Our lead has come from international markets, early weakness from the US, where there is a bit of concern about
earnings and then the expected tapering of US$10 billion from the Fed,” said James Snell, First NZ Capital institutional
equities director. “There is nervousness around emerging markets. South Africa had rate hikes overnight, as did Turkey.”
Governance software developer Diligent Board Member Services led the index lower today dropping 3.4 percent to $4.25, as
the company informed the stock exchange of further accounting errors. Wellington-based accounting software maker Xero,
slid 3 percent to $ 40.75, and security software specialist Wynyard Group, which has gained 154 percent since its July
listing, fell 3.5 percent to $2.80.
Property stocks were also down after the Reserve Bank’s decision to hold interest rates for the moment came with a
promise they will rise soon, reducing the appeal of the dividend paying stocks. Argosy Property fell 1.6 percent to 91.5
cents, and Precinct Properties New Zealand was down 0.5 percent to 99.5 cents. Property for Industry slid 0.8 percent to
$1.27, while Kiwi Income Property Trust slipped 0.5 percent to $1.10.
Blue chip stock on the index also fell. Auckland International Airport fell 0.9 percent to $3.675, and Telecom dropped
1.7 percent to $2.32. New Zealand biggest listed company Fletcher Building slipped 0.3 percent to $8.87 and casino
operator Skycity Entertainment Group slid 1.3 percent to $3.85.
Shares in MightyRiverPower fell 0.8 percent to $1.945 after the government controlled power company said its average
sales price to customers increased 0.6 percent to $111.17 per megawatt hour in the three months ending Dec. 31. Meridian
Energy rose 0.5 percent to $1.015.
Melbourne-based gold miner OceanaGold was one of the day’s few gainers, rising 5.1 percent to $2.26 Retailer Warehouse
Group advanced 1.1 percent to $ 3.57, and units in Fonterra Shareholders’ Fund rose 2.5 percent to $6.26. National
carrier Air New Zealand was unchanged at $1.70.
(BusinessDesk)