MARKET CLOSE: NZ shares gain a 2nd day; FPA, Cavalier rise

Monday 15th June 2009

New Zealand shares rose for a second day, led by Fisher & Paykel Appliances and Cavalier, amid optimism investors’ appetite for equities is reviving in the face of record-low interest rates and signs the global slump may be abating.

The NZX 50 Index rose 15.33, or 0.5%, to 2825.15 and is up 2% this year. Within the index, 26 stocks rose, 12 fell and 12 were unchanged. Turnover was $76.5 million.

F&P Appliances (NZX: FPA ) rose 7.6% to 71 cents and carpet maker Cavalier (NZX: CAV ) advanced 5.6% to $1.90, leading gains in manufacturers after government figures showed manufacturing sales rose a seasonally adjusted 0.2% in the first three months of the year, snapping four quarters of declines Tap maker Methven (NZX: MVN ) rose 2.2% to $1.39.

Shares climbed in the U.S. on Friday, with the Dow Jones Industrial Average gaining 0.2% and edging into positive territory for the year after a survey showed U.S. consumer confidence rose to a nine-month high in June.

“The appetite for risk is starting to re-emerge,” said Graeme Thomas, who helps manage $250 million at Milford Asset Management. “”People think things are a little less dire. World interest rates as low as they have ever been so that’s moving people to other asset classes.”

Stocks were mixed across Asia today. The S&P/ASX 200 Index slipped 0.7% to 4034.40, with BHP Billiton and Rio Tinto slipping with lower commodity prices. Japan’s Nikkei 225 fell 0.7% to 10066.23 in early-afternoon trading amid concern stocks may have rallied ahead of valuations.

Telecom (NZX: TEL ), the biggest company on the NZX 50, rose 2.8% to $2.62 after potential third mobile operator Two Degress was chided by the Commerce Commission for its slow progress in installing its equipment into rivals’ towers.

Port of Tauranga (NZX: POT ) slipped 0.2% to $6.18 after its cash-strapped biggest rival, Ports of Auckland agreed to the sale of Queens Wharf to the government and Auckland Regional Council for a combined $40 million. POA chief executive Jens Madsen said the proceeds will be invested in cargo-handling capacity and facilities.

Children’s clothing chain Pumpkin Patch (NZX: PPL ) fell 2.2% to $1.32, the biggest decline on the NZX 50.

NZ Farming Systems Uruguay (NZX: NZS ) fell 2% to 49 cents and PGG Wrightson (NZX: PGW ) declined 1.5% to NZ$1.36.

Air New Zealand (NZX: AIR ) rose 1.9% to $1.05. Pacific Blue may exit the New Zealand market within 18 months because of competition for passengers from discount rival Jetstar and Air New Zealand, according to Macquarie Equities analyst Russell Shaw.

Businesswire.co.nz

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