MARKET CLOSE: NZ stocks rise as kiwi falls

MARKET CLOSE: NZ stocks rise on kiwi dollar weakness; FPA paces gainers on fridge licensing deal

By Jason Krupp

Sept. 16 (BusinessDesk) –New Zealand stocks rose for the third time in four sessions, after the kiwi dollar fell on comments from the Reserve Bank that further rate hikes would be more moderate than previously indicated. Fisher & Paykel Appliances rose for a second day, pacing gainers on the exchange.

The NZX 50 rose 0.4 points, or 0.01%, to 3,195.6. Within the index 22 stocks rose, 15 fell and 13 were unchanged. Turnover on the day was $75.3 million.

Reserve Bank Governor Alan Bollard kept the official cash rate on hold at 3% today, citing a slowing economic recovery for his decision. He cut a percentage point from his forecast track of interest rate hikes over the coming years, prompting the yield on 10-year government bonds and the kiwi dollar to sink.

“The overriding thought for today was the OCR announcement, with the hold expected but not the weaker tone - especially on interest rate hikes in the future,” said Karl Williscroft, a trader with Direct Broking. “That has pushed the currency weaker, which has made it more attractive for people to by kiwi assets and eased us into positive territory.”

F&P Appliances, the whiteware manufacturer, rose 5.2% to 61 cents after its announcement that it had licensed its new fridge compressor technology to Embraco, a unit of Whirlpool. The company’s innovation is said to save up to 30% on power use, and was considerably smaller than existing units.

Pyne Gould Corp. rose 2.4% to 42 cents after the financial services company announced that it had signing a merger agreement for its Marac unit with Canterbury Building Society and Southern Cross Building Society.

The merged unit would seek a banking license and look to list on the NZX, with Pyne Gould holding 71% of the firm, and the building societies taking a 14.5% share each. CBS gained 5.5 percent to $2.90.

Nuplex Industries Ltd., the industrial chemical and resin manufacturer, rose 1.8% to $3.44, ING Medical Properties Trust, the specialist investor in health clinics, rose 1.6% to $1.27, and Port of Tauranga, New Zealand’s largest export hub, rose 1.4% to $6.74.

Abano Healthcare Group, the retirement village developer, fell 3.6% to $5.06, pacing decliners on the NZX 50. ING Property Trust, the listed property investor, fell 2.8% to 70 cents, and energy exploration and production company

NZ Oil & Gas Ltd. fell 2.3% to $1.25.

PMI data released today showed that New Zealand’s manufacturing sector continued to lose momentum amid a patchy economic recovery, with new order slipping to their lowest level in 15-months.

The BNZ-Business NZ Performance of Manufacturing Index provides an early indicator of activity levels, with a reading above 50 indicating expansion, below 50 a contraction. The new order index fell one point in August, extending a 9.8 decline in July. The full PMI index fell to 49.3, down from 49.9 in the previous month.

Methven Ltd., the tap maker, fell 3.4% to $1.69, and Rakon Ltd., the manufacturer of crystal oscillators used in cellphones and GPS units, fell 1.7% to $1.17.

Sky Network television Ltd., New Zealand’s biggest pay-TV company, fell 0.6% to $5.15 after the government announced that it will begin switching off analogue television broadcasts between September 2012 and November 2013. After that date customers will need a Freeview-enabled television or a subscription to a digital pay-television service such as Sky Television in order to watch television.

(BusinessDesk)

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