MARKET CLOSE: NZ shares rise; NZ Refining, Fletcher gain

MARKET CLOSE: NZ shares rise, joining global lift; NZ Refining, Fletcher gain

June 28 (BusinessDesk) – New Zealand shares rose, led by beat-up stocks including NZ Refining and Fletcher Building. Guinness Peat Group fell after a legal setback.

The NZX 50 Index rose 13.56 points, or 0.4 percent, to 3401.34. Within the index, 29 stocks rose, 12 fell and nine were unchanged. Turnover was $119 million.

Equity markets worldwide were broadly stronger following gains in US home sales and durable goods orders. The European summit starting Thursday will take over as the focus through the rest of the week.

NZ Refining, the operator of the nation’s only oil refinery, rose 3.5 percent to $2.37, having fallen by a similar amount yesterday to the lowest level since 2004. The stock has a dividend yield of about 7.5 percent while 2-year term-deposits are averaging about 4.7 percent.

Fletcher Building, which was punished yesterday when Australian rival Boral cut its guidance, rose 2.4 percent to $5.93. The stock matched its low of early January yesterday. Fletcher is rated ‘outperform’ based on the consensus of 11 recommendations compiled by Reuters, with a price target of $7.15.

Guinness Peat Group fell 1.1 percent to 45 cents after its biggest remaining asset, the thread-maker Coats, lost an appeal in the European Court of Justice against fines and interest totalling 138 million euros, in excess of provisioning.

The company is winding up its portfolio with plans to return capital to shareholders and the court ruling was as expected, said Paul Harrison, equities manager at BT Funds Management. “The market has become impatient waiting for the buyback.”

Pumpkin Patch rose 2.3 percent to 91 cents even after the children’s clothing chain design director Chrissy Conyngham had resigned after almost 20 years with company. Conyngham will leave in six months, giving the retailer time to find a replacement.

Diligent Board Member Services, which has an application company directors can use on their iPads to keep track of board business, rose 4.2 percent to $3.70. The company joined the benchmark NZX 50 this month and has soared 81 percent this year.

Xero, the cloud-based accounting software firm that joined the NZX 50 at the same time as Diligent, rose 0.6 percent to $4.98 today and has climbed 76 percent this year.

Bathurst Resources, the coking coal miner, fell 4 percent to 48 cents on light volume. The company today said court hearings against resource consents granted 14 months ago and opposed by environmental groups seeking to protect the Denniston Plateau from coal mining will start in Christchurch on Oct. 29.

NZX, the stock market operator, fell 0.7 percent to $1.36. The company is creating a new markets group and regulatory team to make a clearer distinction between the two roles, says new chief executive Tim Bennett.

Kathmandu, the outdoor equipment chain, fell 3.8 percent to $1.28, the biggest percentage drop on the NZX 50. Telecom, the biggest company on the exchange, declined 1.6 percent to $2.40.

Turners & Growers, the fresh produce distributor, was unchanged at $1.62. The company is looking at options to sell and lease back parts of its property portfolio and to sell non-core activities as it chases greater profitability following the takeover of 73 percent of the company by Germany's BayWa last year.

At the firm's annual meeting in Auckland today, chairman Klaus Josef Lutz said T&G would also examine local "add-on" acquisitions to consolidate the New Zealand grower market, packaging and production facility investments, and opportunities in international growth markets.

(BusinessDesk)

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