MARKET CLOSE: Pumpkin Patch leads NZ shares to 9-mth high

MARKET CLOSE: NZ shares gain, pushing NZX 50 to 9-month high; Pumpkin Patch leads

March 14 (BusinessDesk) - New Zealand shares, pushing the benchmark NZX 50 Index to a nine-month high, as the local bourse joined a global rally on optimism growth is returning. Pumpkin Patch led gainers after the retailer took charges against first-half earnings to close unprofitable stores.

The NZX 50 Index rose 28.17 points, or 0.8 percent, to 3498.99, the highest close since June 15 last year. Within the index, 31 stocks rose, 10 fell and nine were unchanged. Turnover was $179 million, making it the busiest day this year, with Telecom alone accounting for over a third of trading volumes.

Across Asia, Japan's Nikkei 225 Index was up 1.9 percent in early afternoon trading and Singapore's Straits Times Index was up 1.2 percent.

The Chicago Board Options Exchange’s Volatility Index, commonly known as Wall Street’s fear gauge, fell 8.4 percent to 14.8 and briefly touched a five-year intraday low in the US trading session, after figures showed strong retail sales growth and the Federal Reserve Open Market Committee gave an upbeat account of US growth.

"This will be the 12th day up for the NZX - it hasn't had a down day in March -on the back of offshore markets as confidence returns in America," said Grant Williamson, director at Hamilton Hindin Greene. "We are seeing good demand for local stocks"

Pumpkin Patch, the children's clothing retailer, rose 5.8 percent to 91 cents, having shed more than a third of its value in the past 12 months. The company posted a first-half net loss of $30 million on charges to close its US and UK operations. Sales climbed 17 percent. Pretax earnings from continuing operations fell 33 percent to $8.4 million.

"The market is starting to wake up to the idea that the company appears to have got itself in order," Williamson said. "The stock has recovered well since it closed the US/UK operations."

Kathmandu, the outdoor equipment retailer, rose about 5 percent to $1.91. The company is scheduled to release its first-half earnings on March 21.

Telecom extended its gains, rising 0.6 percent to $2.475, a new high since spinning off its Chorus network business into a separately listed company last November. The company has a dividend yield of 12.4 percent.

Fletcher Building, the nation's biggest construction company, gained 1.3 percent to $6.85, returning to the five-month high it reached last week. The company will be a major beneficiary of the rebuilding efforts in Christchurch and has also been buoyed by signs of a pickup in demand for home building.

Trade Me, the online auction site spun off in an initial public offering by Australia's Fairfax Media, rose 2.7 percent to $3.40. That's the highest close since the company listed last year.

Summerset Group, the rest home operator that went public in October last year, rose 0.6 percent to $1.53, also the highest since listing.

"Somerset and Trade Me are both stocks performing well and that does create confidence in the market place," especially with the sell-down of state-owned enterprises looming, Williamson said.

Fisher & Paykel Appliance rose 3.2 percent to 48 cents amid optimism a return of economic growth in the US bodes well for sales of home appliances. Fisher & Paykel Healthcare rose 1.2 percent to $2.46.

Guinness Peat Group, the investment company in wind-down mode, gained 2.9 percent to 52 cents.

Goodman Property Trust rose about 1 percent to $1.035, with a higher-than-average 10.2 million shares changing hands.

(BusinessDesk)

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