MARKET CLOSE: Telecom powers ahead

NZPA

Wednesday 25th May 2011

Telecom shares powered further ahead to a new 16-month high today even though equity markets in Asia were weak, while Fisher & Paykel Healthcare shares fell.

The driver for Telecom continued to be yesterday's announcement it had snared nearly 70 percent of the Government's ultrafast broadband initiative, while Fisher & Paykel Healthcare paid a price for giving disappointing earnings guidance.

After lifting 15c yesterday, Telecom's share price closed up 5c at $2.48 and traded as high as $2.54.

"It was obviously a good result for them from the Government and there were multiple broker upgrades overnight," said James Lee, head of institutional equities at First NZ Capital.

The benchmark NZX-50 index eased 5.186 points, or 0.146 percent, to 3554.365.

Fisher & Paykel Healthcare fell 11c to $3.00 after reporting net profit for the year to March 31 fell 11 percent from a year earlier to $63.9 million, excluding one-off non-cash deferred tax charges.

Unfavourable exchange rate movements were a key factor in the fall, along with expenses related to the establishment and expansion of manufacturing in Mexico.

"The result was bang in line with expectations, but the forward looking guidance had a range that was much wider than the market was expecting," Lee said.

Ebos Group eased 8c to $7.25.

Kathmandu Holdings eased 7c to $2.36 and Port of Tauranga eased 14c to $8.82. TrustPower eased 16c to $7.43 but was trading with a 20c dividend no longer payable.

Fletcher Building eased 8c to $8.93 and Auckland Airport eased 2c to $2.28. SkyCity eased 3c to $3.72.

"Across Asia, regional markets are all lower as traders continued to worry about concerns of US growth and the Eurozone sovereign debt problems," IG Markets said.

A report in the Wall Street Journal suggesting the five largest US banks face a large liability in civil lawsuits if a settlement isn't reached to address improper foreclosure practices saw risk aversion sweep across markets. In the United States on Tuesday, stocks dipped in light volume as lingering concerns about a slowdown in growth more than offset gains in energy shares.

The Dow Jones industrial average lost 0.2 percent to 12,356.21, the Standard & Poor's 500 Index dropped 0.1 percent to 1316.28, and the Nasdaq Composite Index fell 0.5 percent to 2746.16.

Comments from our readers

No comments yet