Market Close: NZ stocks fall, Kiwi Income down on dividend cut

Wednesday 12th November 2008

New Zealand stocks fell, pushing the NZX 50 Index down for the fourth day in five, amid concern weakening economic growth is eroding corporate earnings and returns for investors.

The NZX 50 fell 27.377, or about 1%, to 2772.186. Within the index, 33 stocks fell, nine rose and eight were unchanged. Kiwi Income Property Trust declined 6.6% to NZ$1.06 after posting a first-half loss on the revaluation of its portfolio and cutting its forecast annual distribution to 8 cents a unit.

Pike River Coal fell about 2% to NZ$1 and briefly dropped below its 2007 IPO price on concern demand for coking coal may wane as steel makers reduce production.

In Australia, the S&P/ASX 200 index was 1.2% lower at 3915.3 in late afternoon trading. Coal miners Centennial Coal and Macarthur Coal both dropped more than 10%. Minara Resources declined 14%, Alumina declined 13% and Fortescue Metals dropped 11%.

BHP Billiton, the world�s biggest mining company, shipped 7.6% less iron ore to China last month compared with September, based on figures collated by Port Hedland harbor. That follows an announcement this week from Rio Tinto that it would cut iron ore output in Australia by 10% because of less demand from Chinese steel mills. Japan�s Nikkei 225 Index dropped 1.3% in mid-day trading.

�People have to be prepared for very high levels of volatility� in the stock market, said Paul Richardson, who manages about NZ$150 million at BT Funds Management. �The biggest concern is on earnings. People are looking for certainty.�

Fletcher Building, New Zealand�s biggest construction company, fell 0.7% to NZ$5.56 after the company said annual profit may tumble as much as 38% on weaker earnings from building products, distribution and infrastructure projects. The company said it will strive to maintain its dividend at 2008 levels even as profit falls.

The company�s forecast was in line with investors� expectations, Richardson said.

Lyttelton Port Co., which is in talks about an operational merger with its largest South Island rival, was unchanged at NZ$2.30 after the company told shareholders that profit growth may stall this year as dwindling global economic growth reduces volumes of freight. The shares have declined 10% this year.

Fishing company Sanford Ltd. climbed 0.2% to NZ$5.63 as the New Zealand dollar fell, lifting the value of export sales when they�re brought home. The stock has soared 40% this year, making it one of the stand-out performers in an index that has dropped 30%.

Medical equipment manufacturer Fisher & Paykel Healthcare Corp. rose 0.3% to NZ$3.20. Shares of the company, which gets 85% of its revenue in U.S. dollars, has gained 8% in the past three months.

ING Property Trust gained 1.6% to 62 cents. After the close of trading today, the trust announced the unconditional sale of a property on Newton Road, Auckland, for NZ$3.7 million, which is 97% of its March 31 book value, it said. The trust is selling non-strategic assets to repay debt.

Tourism Holdings Ltd., New Zealand�s biggest campervan rental company, fell 1.1% to 87 cents, its second daily decline. Yesterday, the company said profit will fall this year as consumers cut back on discretionary spending and tourist numbers weaken.

(Businesswire.co.nz)

Top 50: Last updated: 12/11/2008 5:09pm

AIA	1.74	-0.02
AIR	0.88	-0.03
AMP	6.10	+0.10
ANZ	18.75	-0.25
APN	3.24	-0.08
APT	0.99	-0.01
CAV	2.20	-0.08
CEN	7.16	-0.09
EBO	4.35	0.00
FBU	5.56	-0.04
FPA	1.37	+0.01
FPH	3.20	+0.01
FRE	3.08	+0.04
GFF	1.85	0.00
GMT	1.00	-0.04
GPG	1.01	-0.01
HLG	2.30	0.00
IFT	1.82	-0.01
IMP	1.05	0.00
ING	0.62	+0.01
KIP	0.99	-0.07
LNN	10.20	-0.20
MFT	5.05	-0.15
MHI	0.62	-0.03
MVN	1.42	-0.01
NPX	5.09	-0.21
NZO	1.27	+0.02
NZR	6.50	-0.05
NZS	1.00	-0.02
NZX	5.95	-0.10
PFI	1.05	-0.02
PGW	1.51	-0.07
POT	6.51	-0.06
PPL	0.99	+0.01
PRC	1.00	-0.02
RAK	1.80	-0.03
RYM	1.45	-0.05
SAN	5.63	+0.01
SKC	3.03	-0.03
SKL	0.81	0.00
SKT	3.66	+0.01
STU	2.85	-0.02
TEL	2.41	0.00
THL	0.87	-0.01
TLS	4.87	-0.07
TPW	7.40	-0.10
TWR	1.55	-0.02
VCT	1.97	0.00
WBC	21.85	-0.32
WHS	3.85	0.00

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