MARKET CLOSE: NZX 50 rises for 5th day; Norgate firms gain

Thursday 19th March 2009

Shares rose, pushing the NZX 50 Index up for a fifth straight session, led by Skellerup Holdings and firms associated with Craig Norgate.

The NZX 50 rose 26.883, or 1%, to 2633.209. Within the index, 24 stocks gained, 14 fell and 12 were unchanged. Turnover was NZ$59.9 million.

Skellerup rose 10% to 66 cents, with 49,000 shares changing hands. NZ Farming Systems Uruguay gained 7.7% to 70 cents and PGG Wrightson rose 9.1 to $1.20. The shares gained as Wrightson chairman Norgate's investment company said it had secured funding to refinance $42.5 million of preference shares, easing concern it would sell its stake in the rural services company to repay debt.

New Zealand shares gained after a rally on Wall Street sparked by the Federal Reserve's announcement that it would buy as much as US$300 billion of Treasury bonds and purchase more mortgage-related debt to ease credit conditions and revive the world's largest economy. The Fed's statement also helped weaken the U.S. dollar against most major currencies, driving the kiwi above 54 cents.

"You'd be very brave to say it is the turning point," said Stephen Walker, head of asset management at Goldman Sachs JBWere. "What you can say is that there are more positive signs for economies then we were seeing a few months back. There's more reasons to be optimistic than there were."

Guinness Peat Group climbed 2.7% to 75 cents and Vector Ltd. rose 3% to NZ$2.28. Tourism Holdings gained 2% to 48 cents and Sky Network Television rose 2.6% to $3.95.

Fletcher Building fell 2.2% to $5.92, after shedding its dividend. ING Property Trust rose 1.7% to 59 cents after the trust agreed to sell three properties for $22.3 million. So far this financial year, ING Property has sold 16 properties for a total of $112 million, which amounts to an average 94% of their March 2008 book values.

Cavalier Corp. tumbled 12% to $1.58, the biggest decline on the NZX 50 today.

Fisher & Paykel Appliances sank 7% to a record low 39 cents amid concern Nuplex Industries is struggling to sell shares to bolster its balance sheet, and FPA may be in the same boat.
Walker said the companies weren't in the same position. F&P Appliances has a "temporary debt issue" caused by a jump in the value of overseas debt as the kiwi dollar weakened and a build up of working capital and duplicate facilities as it transitioned to its new global strategy, with plants in low-cost centres.

The company expects debt to fall by $230 million from $570 million this year and it had at least $100 million of surplus inventory it can run down and surplus property worth about $90 million.

Businesswire.co.nz

Comments from our readers

No comments yet