MARKET CLOSE: NZ stocks rise; Pike River leads

MARKET CLOSE: NZ stocks rise; Pike River leads gains on hydro-coal milestone

By Jason Krupp

Oct. 11 (BusinessDesk) – New Zealand stocks rose for the second time in three sessions, lead by Pike River Coal Ltd., after the company said it is on track to ramp up its hydro-mining production. Broader influences from offshore markets were subdued with U.S. markets closed Monday for Columbus Day.

The NZX 50 Index rose 2.2 points, or 0.06%, to 3,234.8. Within the index, 19 stocks rose, 16 fell and 15 were unchanged. Turnover was $77.3 million.

Pike River Coal, the coal miner, climbed 6.2% to $1.20 after the company’s new chief executive Peter Whittall said that the coal miner reached its target for roadway development and came close to meeting a Sept. 24 target of extracting 1,000 tonnes of hydro coal.

“Pike has been one of those stocks that has perpetually disappointed, so there is a certain amount of relief that they have achieved a target,” said Craig Brown, who helps manage $1.1 billion in equities for ING New Zealand Ltd. “They’re moving past the development phase and into the production phase, so investors can now focus on the macro issues affecting the stock price.”

Pyne Gould Corp., the financial services company, rose 5% to 42 cents, Cavalier Corp, New Zealand’s only listed carpet maker, rose 3.1% to $3, and general insurer Tower Ltd. rose 1.7% to $1.83.

Scott Technologies Ltd., the Dunedin-based automated and robotic machinery maker, rose 7.7% to $1.04, the highest since February 2008, adding to its 4% gain on Friday, when it said profit jumped to $2.8 million from a year-earlier $400,000.

Hellaby Holdings, the investment company, rose 2.1% to $1.96 after the company said it will redeem $50 million of capital notes six months before they are due to mature, to take advantage of lower interest rates available through its core bank debt.

The company’s June 15, 2011, notes pay an annual coupon of 8.5% a year. The company will use provisions of its trust deed to repay the notes in full on Dec. 15, it said in a statement today. It first sold the notes in 2006.

Allied Work Force Group, the labour pool company, rose 2% to $1 after the company said it had entered into a conditional agreement to buy specialist healthcare provider Panacea Healthcare Ltd. as part of a strategic move to broaden the company's operations.

Panacea, formerly known as Auckland Nursing Bureau, provides ACC-funded nursing and support services to the disabled and elderly in the Auckland and Central North Island regions. No details on the conditions or price were released, although AWF said it will be funded through cash and bank debt.

Westpac Banking Corp. rose 0.8% to $30.55 on the NZX on the Australian lender's plans to cut thousands of head office and administration jobs over the next two years as it attempts to reduce costs and streamline its business, according to press reports.

Westpac said it will also consider the possibility of sending back-office jobs overseas. The job cuts are only expected to affect Westpac's operations in Sydney. Shares last traded at A$23.09 on the ASX today.

Telstra Corp, the Australian telephone company, rose 0.5% to $3.49 on the NZX, after the company said it may appeal a High Court ruling that allows Kordia to upgrade a fibre-optic network jointly owned by the two firms.

The ruling potentially clears the way for Kordia, a state-owned enterprise, to compete against TelstraClear in a number of cities and town in New Zealand.

Telstra shares were last trading at A$2.68 on the ASX on Friday.
NZ Farming Systems Uruguay Ltd., the South American dairy operator, fell 3.1% to 63 cents, pacing decliners on the exchange.

Fisher & Paykel Appliances Holdings, the whiteware manufacturer, fell 1.7% to 57 cents, Property For Industry Ltd., the commercial property investor, fell 1.6% to $1.21, and food ingredient maker Goodman Fielder Ltd. fell 1.1% to $1.76. Telecom Corp., New Zealand’s biggest telephone company, fell1% to $2.03.

AMP Ltd fell 0.7% to $6.86 on the NZX after the Australian wealth manager announced that it is switching to a fee-per-service based system for retail investors rather than a commission one. On the ASX shares were last down 0.4% to $5.26.

(BusinessDesk)

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