MARKET CLOSE: NZ stocks join global slide; Wrightson, Air NZ fall

Tuesday 16th June 2009

New Zealand shares fell, joining a global slide after weak U.S. manufacturing data and rising European unemployment stoked concern the global economy isn’t recovering as fast as some investors had hoped.

The NZX 50 Index declined 39, or 1.4%, to 2786.15, the biggest decline in more than a month. Within the index, 33 stocks fell, seven rose and 10 were unchanged. Turnover was $93 million.

PGG Wrightson (NZX: PGW ) New Zealand’s biggest rural services company, fell 4.4% to $1.30 after prices of a wide range of commodities declined. The Reuters/Jefferies CRB Index of 19 commodities fell 2.2% to 256.37. Fishing company Sanford (NZX: SAN ) fell 3.5% to $5.50.

Air New Zealand (NZX: AIR ) slid 3.8% to $1.01 and Skellerup Holdings (NZX: SKL ) fell 3.6% to 54 cents.

Coal miner Pike River Coal (NZX: PRC ) fell 3.3% to $1.19 as Newcastle Port Corp., the world’s biggest shipment point for coal, said exports dropped 17% last week and the queue of ships waiting to load fell.

In the U.S., the Standard & Poor’s 500 Index fell 2.4% after the Federal Reserve Bank of New York’s ‘Empire State’ index worsened to minus 9.4 this month from minus 4.6. Manufacturing in the New York region shrank as sales fell and inventory levels declined. In Europe, the Dow Jones Stoxx 600 fell 2.5%as the European Union’s statistics office said payrolls in the region had a record slump in the first quarter while employment slipped 0.8% from the fourth quarter.

Shares fell across Asia today, with Japan’s Nikkei 225 Index declining 2.9%, Hong Kong’s Hang Seng sliding 3.1% and Australia’s S&P/ASX 200 Index dropping 1.7%.

“People are questioning whether the economic fundamentals are set to recover or whether people are being too premature,” said Angus Gluskie, investment director at White Funds Management in Sydney. “When you get information like the New York manufacturing it’s a very strong reminder” that there’s a way to go.

Fletcher Building (NZX: FBU ), New Zealand’s largest construction company, fell 2.7% to $6.60. The stock is 15% overvalued, based on a discounted cash flow measure, according to the ValueCruncher website, which values it at $5.74. Steel building products company Steel & Tube Holdings (NZX: STU ) fell 1.4% to $2.86.

Children’s clothing chain Pumpkin Patch (NZX: PPL ) fell 3% to $1.28.

Among signs that global growth isn’t rebounding as fast as optimists had hoped, farm chemicals producer Nufarm forecast a 15% drop in profit on dwindling sales of weedkiller in the U.S. and Australia. Its shares tumbled 12% on the ASX today.

Vector (NZX: VCT ), the nation’s biggest electricity and gas lines company, rose 0.5% to $2.06 after the company said it was “cautiously optimistic” that the company’s full year EBITDA and net profit will be “comfortably within or above the range of analysts’ most recently published forecasts.”

Fisher & Paykel Appliances (NZX: FPA ) fell 2.8% to 69 cents and Fisher & Paykel Healthcare (NZX: FPH ) declined 1% to $2.92.

Juice maker Charlie’s Group (NZX: CHA ) rose 4.6% to 11.5 cents after Fairfax Media reported the company has appointed ABN Amro Craigs to advise on options including a sale of assets, raising capital or a merger with other industry players.

Businesswire.co.nz

Comments from our readers

No comments yet