CLOSE: Shares edge up; NZX, Mainfreight advance

Monday 10th August 2009

New Zealand shares rose, pushing the NZX 50 Index back toward a nine-month high as better-than-expected US employment data lifted optimism the global economy will recover.

Stocks exchange operator NZX, which posted a surge in profit, and Mainfreight were among gainers.

The NZX 50 rose 11.97, or 0.4%, to 3080.97 and has advanced on 17 of the past 20 trading days. Within the index, 33 stocks rose, seven fell and eight were unchanged. Turnover was $57.2 million.

NZX (NZX: NZX ) rose 3.2% to $7.85, the highest close in a month. The company on Friday posted a gain in first-half net income of more than 1000% to $60.8 million on asset sales. The stock has climbed 54% this year.

Chief executive Mark Weldon “has done some pretty good deals and for that reason I’m happy to be holding the stock,” said Alan Moore, who helps manage $300 million at Milford Asset Management. To be sure, the NZX stock is thinly traded, he said.

Mainfreight (NZX: MFT ), the biggest trucking company on the NZX 50, rose 2.7% to $4.98, the highest close since May 21. The company told shareholders at their annual meeting that volumes were improving in Australia. “Probably for the time being it is reasonably fully priced but I do like the stock,” Milford’s Moore said.

Fletcher Building (NZX: FBU ), New Zealand’s biggest construction company, fell 1.9% to $7.18. Fletcher is expected to report an annual profit before one-time items of $295 million, according to Forsyth Barr, down from $467 million in the previous year. Including costs to close plants and write down the value of its Formica unit, the company may post a net loss of about $50 million, its first since 2001.

Telecom (NZX: TEL ) slipped 0.7% to $2.75. About 900 employees of Telecom contractors Downer EDI and Transfield Services went on strike today amid a shakeup over firms that hold maintenance contracts for the carrier’s Chorus lines company. The stoppage likely disrupted maintenance and installation work.

ING Property Trust (NZX: ING ) rose 4.1% to 77 cents and AMP NZ Office Trust (NZX: APT ) gained 3.8% to 82 cents.

Auckland International Airport (NZX: AIA ) rose 0.6% to $1.75 after successfully selling $25 million of seven-year bonds in a private placement. The sale of the 8% bonds adds to $130 million of the same maturity sold last November.

Pumpkin Patch (NZX: PPL ), the children’s clothing chain, rose 3.5% to $1.80 and Warehouse Group (NZX: WHS ) climbed 0.5% to $4.01. New Zealand retail spending rose 1.1% in July from the same month of 2008, according to data from eftpos transactions company Paymark, which accounts for 60% of the nation’s retail electronic transactions.

The pick-up may add to evidence of the so-called green shoots emerging in the economy, Paymark chief executive Simon Tong said.

Nuplex Industries (NZX: NPX ) climbed 3.5% to $2.07 and Guinness Peat Group (NZX: GPG ) rose 2.6% to 78 cents as optimism about a return of global growth helped lift equity markets in Asia Europe and the U.S. America’s unemployment rate unexpectedly fell in July, while the pace of job losses slowed, stoking optimism the world’s biggest economy is through the worst of its economic decline.

The Dow Jones Industrial Average climbed 1.2% on Friday and Europe’s Dow Jones Stoxx 600 gained 1.2%. In Asia today, Japan’s Nikkei 225 Index rose 1.3% to 10535.54 in early afternoon trading, while Hong Kong’s Hang Seng rose 2.2% to 20825.22.

Michael Hill International (NZX: MHI ) declined 2.9% to 68 cents and Contact Energy (NZX: CEN ) slipped 0.2% to $6.49.

Businesswire.co.nz

Comments from our readers

No comments yet