MARKET CLOSE: NZ shares fall on weak China, Budget yawn
MARKET CLOSE: NZ shares fall after weak Chinese data, no-spend budget; Fletcher drops
May 24 (BusinessDesk) – New Zealand shares fell on a day the government announced a ‘zero’ budget and Chinese manufacturing data weakened. Fletcher Building, Nuplex Industries and Rakon were among decliners.
The NZX 50 Index fell 14.01 points, or 0.4 percent, to 3496.18. Within the index, 24 stocks fell, 16 rose and 10 were unchanged. Turnover was $82 million.
The government today forecast a return to budget surplus in 2015, with few surprises for financial markets and a broad prediction of improving economic growth. Crown debt as a percentage of the economy would peak below 30 percent. Meantime, Chinese manufacturing figures showed production in the world's second-biggest economy may shrink for a seventh month.
"The budget was mildly positive for the markets - pointing out to the rest of the world again that our balance sheet is looking pretty good," Bryon Burke, head dealer at Craigs Investment Partners. “In this time of global uncertainty to have a budget, dollar and share market that does nothing is marginally positive."
Fletcher Building fell 2.2 percent to $6.16 while Telecom, the biggest company on the exchange, gained 0.2 percent to $2.58.
Outdoor equipment chain Kathmandu fell 3.8 percent to $1.53 and was the biggest decliner today.
Nuplex fell 2.9 percent to $2.38 and Rakon dropped 2.1 percent to 47 cents.
Xero fell 1.2 percent to $4.20. The the online
accounting software company today reported that its annual
net loss swelled 5 percent to $7.9 million even as its
annualised committed revenue rose 82 percent to $25.5
million and customer numbers more than doubled.
Xero said
its loss in the current year is likely to be even larger as
it builds the business, planning for significant growth in
offshore markets.
Fisher & Paykel Appliances rose 2.8 percent to 55.5 cents after the company beat its full-year guidance for both appliances and finance while posting a decline in earnings, while warning that the outlook for 2013 is for soft retail markets with weaker demand in Australia.
Net income dropped 45 percent to $18.4 million in the 12 months ended March 31, from $33.5 million a year earlier, the Auckland-based manufacturer said in a statement. Sales fell 7.4 percent to $1.04 billion.
"The result probably pleased a few people," Burke said. “The take on the appliance side has done okay given the environment - again the finance business has done really well to increase the bottom line and we are in an environment where the dollar s weak so things are weaker"
Guinness Peat Group rose 2.1 percent to 49 cents after founder Ron Brierley was re-elected to the board, following calls for his ousting.
"The management disagreements have been going on for a number of years - would be smoother sailing if one or another no longer had an input,” Burke said. “We are still going to see opposing views on the board."
(BusinessDesk)