MARKET CLOSE: NZ shares fall for fourth day as Fletcher hits 6-month low
By Paul McBeth
Oct. 24 (BusinessDesk) - New Zealand shares fell for a fourth session as Fletcher Building dropped to a six-month low
and dairy companies A2 Milk and Synlait Milk remained under pressure.
The S/NZX 50 index declined 30.94 points, or 0.4 percent, to 8,642.24. Within the index, 26 stocks fell, 19 gained and five
were unchanged. Turnover was $140.3 million.
Fletcher was one of the more active stocks with 2.8 million shares traded, almost twice the normal volume. The stock
fell 2.9 percent to $5.71, the lowest close since mid-April.
Greg Smith, head of research at Fat Prophets, said Fletcher doesn't have the tailwind of a booming building sector, and
investors are still waiting on the outcome of the sale of its international business.
"It looks like suggestions the share price bottomed out around $6 in September proved premature," he said.
Synlait led the market lower, dropping 5 percent to $8.70 on light volumes while A2 declined 1.5 percent to $10.10. The
milk processor and milk marketing firm have been strong performers on the benchmark index over the past two years. They
have given up some of those gains in recent months as investors reassess the optimism built into the share price over
future earnings.
Chorus fell 1.4 percent to $4.485 after reaching an arrangement with the government setting price caps until a new
regulatory regime comes into effect in 2020. Spark New Zealand, the biggest user of the regulated lines, was unchanged
at $3.86. The stock was the most traded today on a volume of 3.8 million.
Z Energy bounced from a 32-month low, rising 0.3 percent to $5.89 on about three times its average volume at 2.2
million. Prime Minister Jacinda Ardern today ruled out any further regional fuel taxes.
Restaurant Brands New Zealand rose 2.4 percent to $8.46, after receiving a partial takeover notice last week from
Mexico's Finaccess Capital. SLI Systems, which is also under takeover offer, rose 5.4 percent to 59 cents. Tourism
Holdings, which is in talks to sell some of its businesses, increased 0.2 percent to $5.12. Ebos Group, which is buying
out a junior partner in an Australian retail pharmacy chain, advanced 0.5 percent to $21.40.
Sky Network Television rose 1.8 percent to $2.32 on moderate volumes. Smith said the pay-TV operator has been recovering
as investors regain confidence in its plans to compete more vigorously with online streaming rivals.
Retirement village operators were weaker. Metlifecare declined 1.7 percent to $5.85, Ryman Healthcare fell 1.6 percent
to $11.60, and Summerset Group dropped 1.2 percent to $6.52 on more than three times its average volume at 1.1 million
shares.
Kathmandu increased 1.1 percent to $2.67 on 2.9 million shares, more than twice its average volume. Other busy stocks
included Contact Energy, which slipped 0.9 percent to $5.53 on volume of 2.1 million shares. Kiwi Property Group
declined 0.8 percent to $1.33 on 2.9 million shares, Goodman Property Trust was unchanged at $1.53 with 1.2 million
shares traded and Auckland International Airport was up 1.3 percent at $6.90 on volume of 1.3 million.
Skellerup Holdings was unchanged at $2.09 after saying first-quarter earnings were more than 10 percent higher than a
year earlier and annual profitability was expected to improve.
Smith said he was surprised the stock didn't gain on the outlook, although investors are extra cautious in the current
environment.
Michael Hill International was unchanged at 72 cents after providing more detail on how it is adopting a new strategy to
widen margins.
Steel & Tube Holdings was unchanged at $1.36 after it said a record $1.9 million fine for making misleading representations
about the testing methodologies used in some steel mesh products wouldn't affect this financial year's result.
NZME was unchanged at 63 cents after it gave up on a planned merger with rival Stuff. The media companies won't appeal
the rejection of their merger to the Supreme Court.
(BusinessDesk)