MARKET CLOSE: NZ shares up, Fletcher and Spark gain while A2, Tegel, Kathmandu drop
By Sophie Boot
Dec. 7 (BusinessDesk) - New Zealand shares rose, led higher by Fletcher Building and Spark New Zealand, while A2 Milk Co
and Kathmandu Holdings weakened.
The S/NZX50 Index gained 41.74 points, or 0.5 percent, to 8,172.6. Within the index, 24 stocks rose, 14 fell and 12 were
unchanged. Turnover was $145 million.
"Offshore markets didn't give us too much of a lead last night, and the market is probably just recovering from the
first three days of the week, which have been pretty poor," said Grant Williamson, director at Hamilton Hindin Greene.
"The closer we get to Christmas the more the volumes will continue to fall back."
Fletcher Building led the index, up 3.2 percent to $7.01.
"There has been a lot of interest focussed on Fletcher Building for no particular reason but its oversold position - it
has bounced back up on bargain hunting," Williamson said.
Spark New Zealand rose 2.5 percent to $3.64 and Air New Zealand gained 2.1 percent to $3.225.
Kathmandu Holdings was the worst performer, down 2.1 percent to $2.34, with Mainfreight down 1.5 percent to $24.15 and
Tourism Holdings falling 1.3 percent to $5.30.
A2 Milk Co dropped 1.9 percent to $7.93. It has settled a court case in Australia with its rival Lion Group. Lion had
brought a case against A2 over the science behind health-related claims about the milk, with A2 countersuing over its
milk brand's use of A2 protein claims, seeking an injunction and damages. Both companies have agreed not to pursue their
claims and have come to a confidential settlement.
"That share price has got a mind of its own, the news didn't have too much of a bearing on the stock at all," Williamson
said.
Z Energy dropped 0.8 percent to $7.62. Yesterday, the government said it has asked the Ministry of Business, Innovation
and Employment to further investigate fuel prices and is looking to increase the Commerce Commission's market studies
powers by the end of next year after getting more information on the fuel market.
"There's been a lot in the media and it has got one or two investors a little bit nervous," Williamson said.
Trustpower dipped 0.5 percent to $5.95. It is eyeing up King Country Energy's retail business as it teams up with King
Country Electric Power Trust to buy out the remaining minority shareholders.
The Tauranga-based utility company will form an unincorporated joint venture with the trust, which owns 19.98 percent of
King Country Energy, which will then make a takeover offer for the central North Island electricity generator and
retailer, it said in a statement. The $5 a share offer is a premium to the $4.50 the shares last traded at on the
Unlisted exchange before being halted on Dec. 3.
Outside the benchmark index, Tegel Group fell 3.3 percent to $1.18. The shares dropped nearly 13 percent yesterday after
it said first-half earnings fell 2.3 percent, missing estimates and stoking concern it hasn't managed to stabilise
profitability in a domestic market where competition is restraining prices.
"Tegel has taken a bit of a battering, it's not at its lows yet from when it got hit extremely hard in the middle of the
year but investors are certainly not liking that," Williamson said. The stock reached a record low $1.05 in June.
Opus International Consultants was unchanged at $1.81. It will de-list from the NZX in January, with its shares to be
suspended from Dec. 11, after being acquired by Canadian listed consultancy firm WSP Global Inc.
(BusinessDesk)