MARKET CLOSE: NZ stocks rise on US QE speculation

MARKET CLOSE: NZ stocks rise on QE speculation; Wrightson, Steel & Tube and Rakon lead gains

Oct. 13 (BusinessDesk) – New Zealand stocks rose for the second time in three sessions, pacing Asia Pacific markets higher as the prospect of a second round of quantitative easing in the U.S. buoyed investor appetite. PGG Wrightson Ltd., Steel & Tube Holdings and Rakon Ltd. paced gainers on the day.

The NZX 50 Index rose 0.98 points, or 0.1%, to 3,231.81. Within the index, 18 stocks rose, 15 fell and 17 were unchanged. Turnover was $84.3 million.

In the U.S. overnight the minutes from the last Federal Open Market Committee meeting were released, suggesting the central bank will embark on a second round of asset purchases when it meets next month.

“U.S. market picked up the Fed’s hints that it is looking strong on another round of quantitative easing,” said Karl Williscroft, a trader at Direct Broking. “That’s fed into us and regional markets on the day.”

Wrightson, the rural services company, rose 3.6% to 58 cents. Today is the first day of the extended government guarantee, and Wrightson Finance was among the finance companies that chose to retain Crown backing.

Steel & Tube, the maker of steel products for the construction industry, rose 2.5% to $2.49, Rakon, the maker of crystal oscillators used in cellphones and GSP units, rose 1.7 to $1.23, and Fletcher Building Ltd., the nation’s largest construction company, rose 1.2% to $$.19.

Pike River Coal Ltd. rose 0.8% to $1.20, easing back from the historic highs yesterday as the coal miner announced it had reached one of its hydro-coal milestones on schedule.

“It great to see them get closer to actual production, after all their job is getting coal out of the ground,” Williscroft said.

NZ Oil & Gas Ltd., the energy exploration and production company which holds a 25% stake in Pike, rose 0.8% to $1.34.

Telecom Corp., New Zealand’s biggest telephone company, was unchanged at $2.02. Communications Minister Steven Joyce announced today that the government will waive requirements on Telecom to migrate its existing broadband customers to the new wholesale broadband service and made other concessions over requirements Telecom had called onerous.

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