NZX CLOSE: Shares slip in light trading; Warehouse, FPH fall

Monday 14th September 2009

New Zealand shares fell in light trading as unexpectedly weak retail sales weighed on Warehouse Group and Fisher & Paykel Healthcare slipped in the face of a resilient kiwi dollar.

The NZX 50 Index fell 8.5%, or 0.3%, to 3128.67. Within the index, 25 stocks fell, 18 rose and seven were unchanged. Turnover was $44.9 million, marking it as one of the lightest trading days this year.

Warehouse Group (NZX: WHS ) fell 0.7% to $4.22 after Statistics New Zealand released figures showing retail sales dropped 0.5% in July, against forecasts for a 0.5% gain. Children’s clothing chain Pumpkin Patch (NZX: PPL ) fell 2.1% to $1.91 and men’s and women’s apparel retailer Hallenstein Glasson Holdings (NZX: HLG ) fell 0.3% to $2.97.

The retail data lags behind electronic card figures for August showing a pick-up in spending on debit cards. Still, it raises questions about the consumer-led recovery Reserve Bank Governor Alan Bollard pointed to in his review of monetary policy last week.

“The retail figures don’t look like they would lead an economy anywhere,” said Stephen Wright, private client adviser at ASB Securities, which had forecast a 0.6% gain in July retail sales. “Everybody was disappointed. The economy isn’t picking up.”

The New Zealand dollar fell after the retail data, and was recently at 69.70 U.S. cents, from 70.68 cents earlier. Still, it has climbed about 9 U.S. cents in the past four months, sapping the value of exporters’ overseas sales.

F&P Healthcare (NZX: FPH ), which gets almost 80% of its revenue in U.S. dollars, fell 1.5% to $3.32.

Air New Zealand (NZX: AIR ) fell 3.2% to $1.21 and Auckland International Airport (NZX: AIA ), the nation’s busiest gateway, slipped 1.7% to $1.78. A strong currency makes New Zealand a more expensive place to visit.

New Zealand Oil & Gas (NZX: NZO ) climbed 3.1% to $1.66, the biggest gainer on the NZX 50, after brokerages speculated on the value to its shares of a successful result from its drilling to extent the Tui field and its Hoki and Albacore prospects.

“The activity is all in that Taranaki basin area and they have themselves said it is highly prospective,” ASB’s Wright said. Analysts have speculated success could add 50 cents to 80 cents to the share price.

Wellington Drive Technologies Ltd (NZX: WDT ) fell 2% to 9.7 cents after the designer and builder energy-saving motors and fans said it plans to raise $8.5 million via a placement of shares to its biggest investor, Australian ethical fund manager Hunter Hall Investment Management. The company agreed to place 85 million new ordinary shares at 10 cents apiece to Hunter Hall, subject to shareholder approval.

Skellerup Holdings (NZX: SKL ), the rubber goods and milking equipment maker, rose 2.7% to 57 cents. The manufacturer is seeking to raise $21.5 million via a rights issue to repay debt and fund its expansion. The company is offering two new shares for every five held at 40 cents apiece.

Businesswire.co.nz

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