MARKET CLOSE: NZ stocks fall as TEL, CEN drop, NZO gains

MARKET CLOSE: NZ stocks fall as Telecom, Contact drop, NZO gains

By Jason Krupp

Nov. 25 (BusinessDesk) - New Zealand stocks fell, dragged lower as Telecom Corp. and Contact Energy Ltd. led the bourse lower on a day marked by light volumes ahead of the Thanks Giving holiday in the U.S.

The NZX 50 Index fell 4.54 points, or 0.13%, to 3,264.66. Within the index, 19 stocks fell, 21 rose and 10 were unchanged. Turnover was $80.1 million.

Telecom, New Zealand's biggest telephone company and second-largest stock on the NZX, fell 1.8% to $2.15, while Contact, the country's third-biggest listed company, fell 0.2% to $5.87.

"Turnover has been particularly light, with quite a few investor days and annual meetings going which are occupying people's attention," said David Price, a broker at Forsyth Barr. "Telecom and Contact, a couple of the biggies, just dragged the index lower on the day."

Kiwi Income Property Trust, the property investor, fell 3.8% to $1.01, pacing decliners on the main board. PGG Wrightson Ltd., the rural services group, fell 2% to 48 cents, and Fisher & Paykel Healthcare Corp., manufacturer of breathing masks and respirators, fell 2% to $2.89.

Pyne Gould Corp., the financial services company, fell 2.5% to 39 cents ahead of a shareholder vote tomorrow on whether to allow its Marac Finance unit to merge with CBS Canterbury and Southern Cross Building Society to form a South Island bank.

So far CBS and Southern Cross shareholders have voted in favour of the merger, although the deal still needs the thumbs-up from depositors and bondholders in the three companies before becoming a reality.

Vital Healthcare Property Trust, the specialist investor in medical clinics, fell 1.8% to $1.10 one day after shareholders approved expansion into Australia with the acquisition of 12 properties.

National Property Trust, the property investor, was unchanged at 53 cents after shareholders overwhelmingly voted to turn the trust into a regular company and internalise its management contract at a cost of nearly $20 million.

The vote is the culmination of efforts by a group of unit holders with some 10% of the company, led by the family of businessman Selwyn Cushing. They had pushed for the change, saying the trust has performed poorly under the current manager, one of the units of St Laurence to avoid receivership.

New Zealand Oil & Gas Ltd., the energy exploration and production company which owns a 29% stake in Pike Rive Coal Ltd., rose 5.6% to 94 cents, paring back this week’s slump as the company’s executives prepare to meet to discuss the future of the mine. The second explosion is now presumed to have killed 29 miners and left the operation's future uncertain.

Pike board will meet tomorrow for a preliminary discussion about the way forward for the company and an initial look at the “impairment of the asset”. While reluctant to discuss the issue at this stage, Pike's chief executive Peter Whittall told a media briefing that "there's still 50-odd million tonnes of coal there."

Steel & Tube Holdings, the manufacturer of steel products for the building industry, rose 4.3% to $2.19 after European steel companies raised prices on their products amid speculation China will pay more for its steel imports as the sector looks to boost its margins.

Telstra Corp., the Australian telephone company, rose 2.2% to $3.66, Ebos Group, which supplies medical and scientific products to the health sector, rose 2.1% to $7.40, and clothing retailer Hallenstein Glasson Holdings, rose 1.8% to $4.58.

Air New Zealand Ltd., the national carrier, rose 0.8% to $1.33 after passenger numbers jumped by almost 10% in October, as the airline increased capacity amid signs that demand is returning to pre-global financial crisis levels.

Fishing company Sanford rose 1.1% to $4.70 after managing director Eric Barratt told shareholders yesterday at the company's annual meeting he expects growing demand will help boost the mussel industry, but the strength of the New Zealand dollar remains a challenge.

Seeka Kiwifruit Industries, the kiwifruit grower and post-harvesting operator, was unchanged at $2.30 after it reiterated its forecast for earnings growth in the first nine months of the year despite shares shedding a quarter of their value in the wake of the Psa outbreak.

Satara Cooperative Group’s bid to tie itself up with fellow kiwifruit grower Eastpack Ltd. is under review because of the outbreak of the Psa bacteria. Shares were unchanged at $1 on the NZAX.

(BusinessDesk)

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