Market Close: Stocks rise as traders seek Xmas bargains

by Paul MacBeth

Wednesday 24th December 2008

New Zealand stocks rose for the second time in three days on light pre-Christmas trading as investors sought out bargains following yesterday's decline.

The NZX 50 Index rose 6.314, or 0.2%, to 2668.057 at the close of trading. Within the index, 18 stocks rose, 10 fell and 22 were either unchanged or untraded. Traders looked for good deals before the index closed until next week for the Christmas break.
"The markets look very cheap," said Craig Brown, who manages NZ$2 billion for ING New Zealand Ltd. Investors "will look for cheap opportunities to make good returns."

Tourism Holdings, which sold its half stake in bus and ferry company InterCity this month for NZ$9.5 million, creating a loss of NZ$3.7 million, was the biggest gainer on the index, rising 7.8% to 69 cents, while Lion Nathan followed close behind, up 7.2% to NZ$9.55.

ING Property Trust announced the sale of four further properties for a total of NZ$15.1 million, taking the total value of its 13 sales this year to NZ$89.5 million. The Trust is selling non-strategic assets to repay debt as it seeks to strengthen its balance ahead of its Mar. 31 balance date.

Fletcher Building fell this after figures showed the biggest drop in U.S. home sales for 21 years. Fletcher, which sells building products including laminated board used in kitchens and bathrooms, fell 2.9% to NZ$5.80.

The median resale house price in the U.S. fell 13%, the most since records began in 1968, according to the National Association of Realtors said. The figures helped underline the deepening slump in the U.S. economy.

PGG Wrightson, the biggest rural services company on the NZX 50, closed unchanged on NZ$1.06, wiping earlier gains after its finance arm completed the sale, including oversubscriptions, of NZ$100 million of bonds paying 8.25% interest.

New Zealand Oil & Gas, which has built a 15% stake in Tui oilfield partner Pan Pacific Petroleum, fell 1.6% to NZ$1.22 as the price of crude oil slid 2.3% to US$39.01 a barrel on the New York Mercantile Exchange. The company is seeking Australian regulatory approval to lift its stake further in Pan Pacific though chief executive David Salisbury said it doesn't plan to move immediately.

Air New Zealand rose 3.5% to 88 cents after announcing it is continuing compensation talks with Boeing Co. amid further delays to delivery of its 787-9 Dreamliners after a machinists strike and production tweaks.

The New Zealand carrier was to have received its first deliveries in early 2010 but in April the timing was delayed until 2012 and has since been pushed back to the first quarter of 2013.

In Sydney, the S&P/ASX 200 Index rose 1.4% to 3619.8 in afternoon trading as BHP Billiton and Rio Tinto snapped their declines.

(Businesswire.co.nz)

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