MARKET CLOSE: NZ shares eke out gains; Trade Me rises

Wednesday 6th July 2016

New Zealand shares rose near the close of trading, while many markets across Asia weakened, as Trade Me Group benefitted from an upgrade from Deutsche Bank and trans-Tasman firms such as Westpac Banking Corp fell in step with their ASX-listed shares.

The S&P/NZX 50 Index rose 6.24 points, or 0.1 percent, to 6977.23, edging up to a new record close. Within the index and against its minor uplift, 24 stocks fell, 18 rose and eight were unchanged. Turnover was $172 million.

Trade Me, the auction website, rose 1.9 percent to $4.89. Analysts at Deutsche Bank raised the company to 'hold' from 'sell' and lifted their price target to $4.68 from $3.95. Trade Me stock has gained about 45 percent in the past 12 months, outpacing the NZX 50's 21 percent gain.

Spark New Zealand rose 1.7 percent to $3.62 and Contact Energy rose 1.3 percent to $5.31.

The benchmark index spent much of the day lower following declines in equity markets and commodities overnight after the Bank of England said some of the near-term risks of the Brexit had "begun to crystallise", while three UK commercial real estate funds have suspended redemptions, citing turmoil in financial markets.

Xero, the cloud-based accounting company, was the biggest decliner, falling 2.1 percent to $17.80, while Westpac dropped 2 percent to $29.20 and Australia & New Zealand Banking Group fell 1.6 percent to $23.97. Among other companies doing business in Australia, SkyCity Entertainment Group fell 1.5 percent to $4.63.

"A few of the trans-Tasman stocks are coming under pressure," said James Lindsay, senior portfolio manager at Nikko Asset Management New Zealand. "Markets are a bit jittery at the moment. There's been lots of small things upsetting people, including the UK funds halting redemptions."

Sky Network Television fell 1.3 percent to $4.72 even after shareholders voted today in favour of a proposed merger with Vodafone New Zealand to create a media and telecommunications company with more grunt to foot it in a competitive market.

"Obviously, the shareholders have come to a pretty strong conclusion it (a merger) is a good idea and that's our conclusions as well," Lindsay said. "It will be able to fight a bit harder and be a bit faster" although the combined entity will still be in a challenging market.

NZME, whose application to merge with Fairfax New Zealand is before the Commerce Commission, fell 1.4 percent to 73 cents.

NZX, the market operator, was unchanged at $1 after its shareholder metrics showed the volume of total trades rose 18 percent to 164,908 in June from the same month a year earlier.

BusinessDesk.co.nz

Comments from our readers

No comments yet