Stocks to watch: New Zealand equity preview

Monday 8th December 2008

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

Themes of the day: Crude oil fell for a sixth straight session on Friday on concern the economic slump will sap demand for fuel. Crude for January delivery dropped 6.5% to US$40.81 a barrel on the New York Mercantile Exchange on Friday, the lowest since December 2004. Stocks rose on Wall Street on Friday. Figures from the Mortgage Bankers Association in the US showed home loans overdue and those already facing foreclosure reached record highs in the third quarter.

Air New Zealand (AIR): The national carrier would be hurt by an alliance or merger between Qantas and British Airways, the NZ Herald reported, citing Sydney-based Capa Consulting analyst Andrew Miller. The stock fell 1.2% to 85 cents on Friday and is down 55% this year.

EBOS Group (EBO): The medical supplies distributor "has a resilient business importing and supplying medical centres and hospitals with healthcare products," according to research firm IRG. The company is shifting more of its trading base to Australia, according to the report. The stock fell 2.6% to $4.15 and has dropped 20% this year, outperforming the NZX 50.

Fletcher Building (FBU): Shares of the construction company that owns the US based Formica brand of laminated building board rose 1.3% to $5.62 on Friday, a day after the central bank slashed the official cash rate by 150 basis points to 5%. Quotable Value figures out today show property values fell 6.8% in November, the second monthly decline of that size.

New Zealand Oil & Gas (NZO): The oil and gas company will supplant Nuplex Industries in the NZX 15 index as of today, which may spur index-weighted funds to increase their holdings. Nuplex has tumbled 50% this year while NZOG has gained 10%.

Ryman Healthcare (RYM): The healthcare investor joined the NZX 10 Index on Friday, replacing Fisher & Paykel Appliances, whose stock has tumbled 60% this year. Ryman has declined about 26%.

Tourism Holdings (THL): Tourism industry leaders are to meet with the government this week to consider strategies for coping with the impact of the global recession on tourism. The stock fell 5 cents to 65 cents and has tumbled more than 70% this year.

By Jonathan Underhill

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