MARKET CLOSE: NZ shares track Asian markets' rise

MARKET CLOSE: NZ shares track Asian markets' rise on China growth figures

By Paul McBeth

Jan. 17 (BusinessDesk) – New Zealand shares bounced from a four-week low as investors shrugged off the negative headlines in Europe, where the region’s bail-out fund was downgraded, and embraced better than expected economic growth in China. Dual-listed Australian stocks paced gainers.

The NZX 50 Index rose 24.16 points, or 0.8 percent, to 3234.8, recouping all of yesterday’s loss. Within the index, 36 stocks rose, nine fell, and five were unchanged. Turnover was $66.7 million.

That followed gains across Asian stock markets as investors got a boost from 8.9 percent expansion in China’s fourth quarter gross domestic product, and ignored Standard & Poor’s decision to cut the rating on the European Financial Stability Fund one notch to AA+ after the mass downgrade of nine of the region’s sovereign nations.

In afternoon trading, Australia’s S&P/ASX 200 index rose 1.4 percent to 4207.5, Japan’s Nikkei 225 index gained 0.7 percent to 8438.21, and Hong Kong’s Hang Seng advanced 1.9 percent to 19369.91.

“Markets took the material downgrade for a region relatively in their stride,” said James Lindsay, equities manager at Tyndall Investment Management. “It’s no news that quite a number of European sovereigns are starting to have a little bit of trouble.”

Dual-listed stocks paced the benchmark index, with food ingredients maker Goodman Fielder leading the exchange higher, up 11 percent to 60 cents. Australian phone company Telstra gained 3.1 percent to $4.38, while financial services firm AMP rose 2.8 percent to $5.60, and lender Australia & New Zealand Banking rose 1.4 percent to $27.38.

Lindsay said Australia’s economy has been under pressure in recent months, and retailers have been “hit really quite hard” over the past six months. Government figures today showed retail spending on credit and debit cards slipped a seasonally adjusted 0.2 percent last month.

Shares in discount retail chain Warehouse gained 2 percent to $3.11, while outdoor equipment retailer Kathmandu rose 2.5 percent to $1.66. Clothing chain Hallenstein Glasson was unchanged at $3.55, while children’s ware retailer Pumpkin Patch fell 1.5 percent to 67 cents.

Shares in governance software firm Diligent Member Services hit a record high $2.50 during trading today, before closing at $2.41, a daily gain of 2.6 percent. The company reported another sharp gain in quarterly sales and forecast its first operating profit in the 2011 financial year. Almost 2 percent of the company’s shares changed hands today for a turnover of $3.9 million.

Gold miner OceanaGold was the biggest decliner on the benchmark index, falling 3.3 percent to $2.94, while rural supplies company PGG Wrightson fell 2.7 percent to 36 cents.

Index heavyweights were mixed, with power company Contact Energy falling 2.7 percent to near a five-month low at $4.88, while phone company Telecom rose 0.8 percent to $1.995 and construction company Fletcher Building gained 1 percent to $5.94.

(BusinessDesk)

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