MARKET CLOSE: Shares rise, led by Nuplex as rights close,

Wednesday 15th April 2009

Shares rose, with Nuplex Industries leading the advance on the final day of trading in the company's rights. PGG Wrightson climbed after its chairman's investment company repaid some debt.

The NZX 50 advanced 0.82, or 0.03%, to 2600.64, the index's third daily gain. Within the index, 18 stocks rose, 11 fell and 21 were unchanged. Turnover was NZ$90.9 million.

Nuplex rose 13% to 35 cents, trimming its slide this year to 72%. Rights to subscribe to seven new shares at 23 cents apiece for each one held ended trading today, soaring 91% to 10.5 cents. The $132 million capital raising will help pay debt and bring the company back within its lending covenants.

Nuplex, which had to cut the price and boost the amount of its offer, joined market heavyweights including Fletcher Building and Freightways in tapping investors for equity funding, indicating there's still demand for shares in an index that has slipped 5% this year.

"These capital raisings have been well supported," said Paul Richardson, chief investment officer at BT Funds Management. "They put the companies beyond the balance-sheet risk right now."

The NZX 50 held up even after the Standard & Poor's 500 fell 2% as declining retail sales in the U.S. stoked concern the world's biggest economy will remain mired in recession. In Asia today, China's Shanghai Securities News website reported that annual GDP growth slowed to a record-low pace in the first quarter after expanding 6.8% in the fourth quarter. It wasn't more specific. Still, the website said the Chinese economy may have reached its trough and be poised to recover. U.S. retail sales unexpectedly fell 1.1% last month.

Japan's Nikkei 225 Index fell 1% to 8748.39 while Hong Kong's Hang Seng declined 2.1% to 15256.15. In Australia, the S&P/ASX 200 Index dropped 0.2% to 3745.10.

"We've still got a very ugly year to get through," BT Funds' Richardson said. "People are putting cash to work where opportunities emerge."

Wrightson gained 3.5% to $1.20. Rural Portfolio Investments, the investment company that owns about 29% of Wrightson, today said it had redeemed 42.5 million preference shares, taking about $46 million of debt of its books. Some investors had feared RPI would sell Wrightson shares to pay its own debt.

Vector, the nation's largest gas and electricity distributor, rose 3.3% to $2.20. The shares are under-valued by about 8%, according to the ValueCruncher website, which uses a discounted cashflow valuation.

Children's clothing chain Pumpkin Patch rose 2.7% to $1.14 and Sky City Entertainment Group climbed 2.9% to $2.89.

Fishing company Sanford Ltd. fell 3.5% to $5.45, the biggest decline on the NZX 50. The stock is rated 'hold' by five analysts who follow the company, according to Reuters.

Carpet-maker Cavalier Corp. fell 2% to $1.85 and Contact Energy, the biggest utility on the index, fell 2.7% to $5.47.

Businesswire.co.nz

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