MARKET CLOSE: NZ shares mixed; Warehouse and NZ Refining gain, Z Energy and Kathmandu decline

Friday 6th January 2017

New Zealand shares were mixed with institutional traders still on holiday, as Warehouse Group and New Zealand Refining gained while Z Energy and Kathmandu Holdings fell.

The S&P/NZX 50 Index dipped 4.95 points, or 0.07 percent, to 6,970.65. Within the index, 28 stocks rose, 13 fell and nine were unchanged. Turnover was $69 million.

Local trading was relatively quiet, but didn't follow stocks on Wall Street, where the Dow Jones Industrial Average fell 0.2 percent, and the Standard & Poor's 500 index dipped 0.1 percent

"Most of the institutional players still seem to be out of the market, it very much is two-way retail trade going on, with pretty light volumes," said Grant Williamson, director at Hamilton Hindin Greene. "The market itself is pretty flat today, probably not a bad performance - Wall Street lost a bit of ground last night, but we're not paying any attention to that."

Warehouse was the best performer on the index, up 2.2 percent to $2.83, while NZ Refining gained 1.5 percent to $2.63 and Argosy Property rose 1.5 percent to $1.03.

Fonterra Shareholders Fund rose 0.5 percent to $6.06, the highest it's been in a year. Dairy product prices fell at the GlobalDairyTrade auction this week, sliding for a second consecutive auction, which is an input cost for the fund which gives investors exposure to Fonterra's earnings.

"A number of analysts have picked it to perform much better in 2017, there are positive signs for shareholders in that stock," Williamson said.

Restaurant Brands New Zealand gained 0.8 percent to $5.16. The fast food retailer's US$105 million deal to buy Pacific Island Restaurants (PIR), the largest fast-food operator in Hawaii with 82 Taco Bell and Pizza Hut stores, has been delayed until the end of February. It raised $94 million in November last year to help fund the acquisition.

Z Energy was the worst performer, down 2 percent to $7.25, with Kathmandu falling 1.6 percent to $1.90 and Meridian Energy dropping 1.5 percent to $2.58.

Outside the benchmark index, Pushpay gained 6.6 percent to $1.79. The mobile payments app developer was issued with a 'please explain' note by the NZX in mid-December after its share price dropped 27 percent in the month, falling as low as $1.29, but has since bounced somewhat.

"That took a tumble late last year but it has really rebounded, for the week it's up a very impressive 31 percent, but it did lose quite a bit of ground a month or two previous to that. They've got a quarterly update coming next week, so investors might be buying ahead of that," Williamson said.

CBL Corp was unchanged at $3.70. It has completed its 94.5 million euro purchase of France's Securities and Financial Solutions Europe SA (SFS), taking over its biggest customer in a deal the credit and financial risk insurer expects to lift earnings. SFS is France's biggest specialist producer of construction sector insurance and, with the IMS claims management operation which CBL has also bought, generated normalised operating earnings of 8.2 million euros on revenue of 41 million euros in 2015.

ERoad was unchanged at $1.60. The logistics and fleet management company said its total contracted units at the end of 2016 were "broadly in line" with expectations, with a 5.1 percent lift from a quarter earlier. The shares first publicly traded at $3.32 in August 2014 after being sold to investors at $3 apiece, and lost 29 percent of their value in the last 12 months.

BusinessDesk.co.nz

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