Stocks to watch: Goodman Fielder covenants, Sky City revamp

Friday 6th March 2009

The following stocks may be active on the New Zealand exchange after developments since the close of trading yesterday.

Themes of the day: Stocks on Wall Street slumped after auditors said General Motors may not be able to survive outside of bankruptcy, China's speculated extra stimulus failed to eventuate and Moody's Investors Service said it may cut JPMorgan Chase's credit rating.

Goodman Fielder (GFF): The foodmaker yesterday hosed down a media report that it was nearing a breach of its banking covenants. "We remain comfortable within our banking covenants and in the last 12 months we have successfully refinanced debt of $770 million," managing director Peter Margin said. The shares fell 6 cents to $1.40 on the NZX. By contrast, the shares jumped 6.5% to A$1.07 on the ASX, with 7.6 million shares changing hands.

Pacific Brands (PBG): The clothing manufacturer may look to shed more jobs as the economic forces it to move its production away from New Zealand and Australia. It has cut over 2000 staff across the two nations in the last fortnight as it struggles to repay debt. The shares held steady on 20 cents yesterday.

Sky City Entertainment Group (SKC): Chief executive Nigel Morrison wants to revamp the company's Auckland casino complex and will increase advertising this year, the New Zealand Herald said. The shares fell 0.4% to $2.63 yesterday.

Telecom (TEL): The largest listed company on the exchange may come under pressure today after stocks tumbled on Wall Street. Telecom has typically been the company most held by overseas investors. Stock rose 3.4% to $2.46.

Westpac (WBC): The appointment of receivers to Winners Group Circle has left St. George Bank, which it recently merged with in Australia, exposed to approximately A$30 million. The bank's stock slipped 0.2% to $20.40 yesterday.

By Jonathan Underhill

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