MARKET CLOSE: NZ shares gain; PGW, Pike, APN rise

MARKET CLOSE: NZ shares gain; Wrightson, Pike, APN lead

April 21 (BusinessWire) – New Zealand shares rose for a second day, with Pike River Coal Ltd. and PGG Wrightson Ltd. benefiting from capital and shareholder activity. APN News & Media Ltd. led the advance.

The NZX 50 Index rose 11.86, or 0.4%, to 3304.96. Within the index, 27 stocks gained, 15 fell and eight were unchanged. Turnover of $109 million was boosted by $27.9 million of Wrightson changing hands.

Wrightson rose 5.4% to 59 cents. Rural Portfolio Investments disposed of about half its holding in New Zealand’s biggest rural services company, raising $27 million. The shares had been seen as an overhang in the market, said Craig Brown, who helps manage $3.3 billion at ING New Zealand.

“It had been identified as they needed to do something,” Brown said. “Wrightson’s not paying dividends to fund them.”

NZ Farming Systems Uruguay fell 2.6% to 38 cents. RPI owns 10 million of its stock, while Wrightson is manager of the South American dairy farm developer.

Pike climbed 3.6% to $1.14. The coal miner confirmed it had made a placement of $10 million, the first leg of its $50 million capital raising which includes a rights issue.

The company has been forced to return to the market several times to get cash to continue mine development, though the coal it will produce is currently at strong global prices.

“It’s a relief rally – they have actually fixed the problem,” said ING’s Brown, who was among institutions to take up the stock at 88 cents. While Pike has again revised back production again, the coal price has been “pretty strong.”

New Zealand Oil & Gas Ltd., which owns 29.5% of Pike and is participating in the capital raising, rose 1.3% to $1.56.

Equities markets strengthened across Asia today, with Japan’s Nikkei 225 Index and South Korea’s Kospi both up 1.7%. Australia’s S&P/ASX 200 Index gained 0.6%. Stocks were stronger in the U.S. yesterday as investors took comfort in better-than-expected earnings.

“You get the feeling the global recovery is getting a bit better, more broad-based by the day but with occasional hiccups” such as the Goldman Sachs Group fraud charges, Brown said. “Underlying it all there’s a steady improvement, particularly in the U.S.”

APN, the publisher of the New Zealand Herald newspaper, rose 6.6% to $3.06. The shares are rated ‘outperform’ based on the consensus of 10 recommendations compiled by Reuters.

AMP Ltd. rose 2.5% to $8.35. The insurer is the front running in bidding for AXA Asia Pacific after a rival and more tempting bid from National Australia Bank was knocked back by Australia’s antitrust regulator. NAB has since indicated it may challenge the ruling.

Pyne Gould Corp. fell 2.1% to 47 cents. Contact Energy Ltd. fell 1.7% to 6.24 and Sanford Ltd. shed 1.1% to $4.40.

(BusinessWire)

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