MARKET CLOSE: NZ shares rise ahead of final election results; Synlait, A2, Fonterra drop
By Sophie Boot
Oct. 6 (BusinessDesk) - New Zealand shares gained, led by Meridian Energy and Port of Tauranga, as investors keep an eye
on tomorrow's final count of the general election and the subsequent coalition talks, while dairy stocks Synlait Milk
and A2 Milk Co gave up gains.
The S/NZX50 Index rose 2.64 points, or 0.03 percent, to 7,977.34. Within the index, 25 stocks rose, 20 fell and five were
unchanged. Turnover was $155.6 million.
"It's a quiet day leading into tomorrow's update on the special votes - that's probably related, people are waiting to
see what happens over the weekend and in negotiations through to the 12th," said James Lindsay, senior portfolio manager
at Nikko Asset Management. "If there is a marked move to one side or the other, you would see currency movements first."
Meridian Energy led the index, up 2.5 percent to $2.89, while Port of Tauranga gained 2.1 percent to $4.39 and Sanford
rose 1.9 percent to $8.
Synlait Milk was the worst performer, down 2.6 percent to $6.72, and A2 Milk Co dropped 1.4 percent to $7.16, both
falling from record highs. The two stocks have gained since last Thursday on confirmation that their brands and recipes
have gained registration in China, removing an obstacle in a market with soaring sales, before both giving up gains
yesterday. They have had strong years so far, rising 122 percent and 241 percent respectively.
"After a particularly strong period for Synlait and A2, they've obviously given back a little bit of their gains, and A2
continues to trade on pretty solid volumes," Linsday said. "The strength earlier in the week was partly to do with one
of the Aussie brokers upgrading A2, a Goldmans analyst upgraded it to buy and put a $7.90 price target on it. There has
obviously been very good demand for Synlait itself, and it's not too long since they received Chinese accreditation
which helps Synlait too, but that certainly assisted this week."
Fonterra Shareholders Fund units declined 2.2 percent, or 14 cents, to $6.10 after shedding rights to a 20 cents per
share final dividend. Polish Dairy, the fifth largest producer of milk in the European Union, will join Fonterra
Cooperative Group's Global Dairy Trade platform from Nov. 21, initially offering skim milk powder, whole milk powder,
butter and lactose on the platform.
CBL Corp fell 1.6 percent to $3.09 and New Zealand Refining Co dropped 1.6 percent to $2.51.
Spark New Zealand dipped 0.3 percent to $3.63. The country's second-biggest mobile carrier has kicked off its response
to the Commerce Commission's probe into the mobile market, urging the regulator to keep it narrow and brief to avoid
regulatory uncertainty for investors.
Outside the benchmark index, Hallenstein Glasson Holdings rose 0.3 percent to $3.35. Glassons, the women's wear brand
owned by Hallenstein Glasson Holdings, has split its chief executive role into two after the departure of Di Humphries,
replacing her with separate New Zealand and Australian heads as it seeks to establish itself further across the Tasman.