MARKET CLOSE: NZ shares rise, led by Auckland Airport, Z Energy; A2 falls from record
By Sophie Boot
Dec. 30 (BusinessDesk) - New Zealand shares rose, led by Auckland International Airport, Goodman Property Trust and Z
Energy, while A2 Milk Co fell from a record high.
The S/NZX 50 Index rose 26.94 points, or 0.43 percent, to 6319.38. Within the index, 25 stocks rose, 16 fell and nine were
unchanged. Turnover was $121 million.
Overnight, oil prices rebounded, and Wall Street ended on a positive note with the Nasdaq Composite Index advancing 1.5
percent, the Standard & Poor's 500 Index rising 1.1 percent and the Dow Jones Index up 1.1 percent.
"Oil prices were up a wee bit overnight, and the US market was relatively strong, so we're looking towards a good run
for the year," said Robert Garden, investment adviser at Craigs Investment Partners. "There was a bit of slippage in New
Zealand at the end of November and early December, and we've seen that ground recovered in a lot of stocks today."
Auckland Airport led the index up, advancing 3.1 percent to $5.74.
Goodman Property rose 2.9 percent to $1.265, Argosy Property advanced 2.2 percent to $1.18, and Kiwi Property Group was
up 1.5 percent to $1.36, after property stocks fell yesterday.
Z Energy rose 2.7 percent to $6.78. The stock has touched a record high of $6.80 twice this month, but fell on Dec. 18
after the Commerce Commission announced it had delayed its decision on whether to approve Z's application to buy Chevron
New Zealand's service station chains until the end of April, adding about $10 million to the cost of the acquisition.
"Market expectation is that the transaction will go through," Garden said. "Obviously the Commerce Commission taking a
bit more time has cast a little bit of doubt over it, but I think it will still go through."
A2 Milk fell 9.3 percent to $2.06, ending a rally which saw it more than double in value from $1.10 since Dec. 17, when
it announced a second earnings upgrade for the year.
The stock hit an intraday high of $2.49, up from yesterday's close of $2.27, before ending the day lower. The stock has
risen 291 percent this year off strong Chinese demand for infant formula, making it the top performer on the NZX 50
Index.
"It's just investors trying to be comfortable with what they are paying for it," Garden said. "The earnings upgrade
obviously created a lot of interest around the story, there was a lot of Australian interest. In the lead up to
Christmas, there were a couple of days where there were 27 or 28 million shares traded each day, and the stock has seen
a big swing down today from that high."
Ebos dipped 2.8 percent to $14. The stock has risen 46.2 percent this year, and Ebos said in October that it expects
annual earnings to again grow at a double-digit rate, after a positive start in the first quarter.
"It's potentially just a bit of profit-taking as they've bounced back up," Garden said. "They've risen really strongly
since the end of September, and they almost touched their all-time highs before close of business yesterday. There's
only been 5,500 shares traded so far today which is making them drop off, so you're only talking about $70,000 worth of
stock. At this time of year, there's a lack of liquidity."
(BusinessDesk)