MARKET CLOSE: NZ stocks rise, led by ANZ, Westpac

MARKET CLOSE: NZ stocks rise; ANZ, Westpac lead gainers on Australian rally

By Jason Krupp

July 8 (BusinessDesk) – New Zealand stocks rose for the fifth straight session, led by Australia & New Zealand Banking Group and Westpac Banking Corp., after upbeat Australian jobs data helped fuel a rally in equities.

The NZX 50 rose 22.2 points, or 0.7%, to 2,983.9. Within the index 28 shares rose, 11 fell and 11 remained unchanged. Turnover on the day was $44.3 million.

The S&P/ASX 200 Index rose 2.3% to 4350.6 in Sydney, led by banks and resources stocks after government figures showed the number of jobs jumped by almost 50,000 in June, more than three times economists’ estimates, while the unemployment rate held at 5.1%.

ANZ Bank’s NZX-listed shares rose 6.8% to $27.56 while Westpac gained 5% to $27.15.

“If you look at the stocks in the Australian market you see that it is the resource and financial stocks people are buying over there, and the jump in ANZ and Westpac is linked to that,” said Paul Richardson of BT Funds Management Ltd., which manages $300 million in New Zealand equities.

“Many of these stocks have been pounded over the last two months, with the market 12-to-13% off in the June quarter, so this is opening up some opportunities,” he said.

Helping lift sentiment on the NZX, Moody's Investors Service said the New Zealand economy will improve in 2011 and 2012, provided the European debt crisis abates. Moody's said the country is well placed to continue benefiting from Australia and Asia's strong growth prospects.

Rakon Ltd., the manufacturer of crystal oscillators for GPS units, rose 6.7% to 96 cents, New Zealand Oil & Gas Ltd., the energy exploration and production company, rose 4.2% to $1.24 and wealth manager AMP Ltd. rose 3.2% to $6.40.

“The market jumped without earnings improvement last year, so it was running a little ahead of itself and the discounts disappeared,” Richardson said. “Some of these are starting to open up again and if you look at the asset allocations for major investors you probably see that they’re putting more of their money into risk markets as the year unfolds.”

Auckland International Airport Ltd. today announced it had bought a 25% stake in Queenstown Airport for $27.2 million. The purchase will be funded from existing cash resources. Shares in the company were unchanged at $1.93.

New Zealand Refining Company Ltd., the oil refinery operator, paced decliners with shares falling 2.6% to $3. Goodman Fielder fell 1.2% to $1.62 and Pyne Gould Corp., the financial services company, fell 2.5% to 39 cents.

Richardson said this reflected a move aware from stocks with defensive revenue streams toward equities with export and growth exposure.

Shareholders in DNZ Property Fund have voted overwhelmingly in favour of a capital raising plan that will see the property investor list on the NZX next month.

Some 98% of shareholders agreed to the bid to raise as much as $45 million through a pro-rata share issue to existing investors, followed by a bookbuild for new parties. DNZ terminated its controversial management contract with Paul Duffy, who is now chief executive, and Alastair Hassell earlier this month at a cost of $35 million, and brought it in-house.

(BusinessDesk)

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