MARKET CLOSE: NZ stocks sidestep downgrades, Asian selloff

Article – BusinessDesk

MARKET CLOSE: NZ stocks sidestep downgrades and Asian selloff, Port of Tauranga on the move

MARKET CLOSE: NZ stocks sidestep downgrades and Asian selloff, Port of Tauranga on the move

By Jason Krupp
Sept. 30 (BusinessDesk) – New Zealand stocks rose, as yield hungry investors helped the exchange to sidestep the broad selloff on Asian markets and the downgrade of New Zealand’s credit rating by Standard & Poor’s and Fitch Ratings. Pumpkin Patch Ltd. led gainers and Goodman Fielder Ltd. fell.

The NZX 50 Index rose 43.18 points, or 1.3%, to 3,343.34, with a turnover of $126.5 million bolstered by traders squaring their books at the end of the quarter. Within the index 32 stocks rose, nine fell, and nine were unchanged.

The New Zealand dollar recently traded 76.40 U.S. cents at 5pm compared to 77.66 cents at 8am, and down from 77.73 cents yesterday.

Asian markets were for the most part mired in the red in afternoon trade as fears the global economy was teetering towards a recession outstripped better U.S. job claims data and news that Germany’s Bundestag had approved changes to the European Financial Stability Fund.

“When you start looking around at alternatives there are still some reasonable yields in our market, and in the short term rates still look like they’re on hold for a while longer,” said Alan Moore, a executive director at Milford Asset Management. “The two downgrades normally would have been received far more negatively than they have been.”

Pumpkin Patch, the children’s clothing chain, rose 5.1% to 82 cents with the stock recovering some the ground it lost this week after reporting a $1.8 million annual loss on costs relating to the closure of its U.S. operations and underperforming U.K. stores.

Cavalier Corp., the carpet maker looking to establish a wool-scouring monopoly in New Zealand, rose 4.9% to $3.20.

AMP Ltd., the Australian wealth manager, rose 4.4% to $4.97. The company’s New Zealand investment arm today announced that it had agreed to sell the management contract for Property For Industry Ltd. to Auckland-based DPF Management Ltd.

While the terms of the deal are confidential, DPF told BusinessDesk the deal will almost double the size of the Auckland-based property group’s portfolio. PFI shares fell 0.9% to $1.15.

Telecom Corp., the country’s biggest phone company, rose 3.5% to $2.64.
Port of Tauranga Ltd., the country’s biggest export hub, rose 3.3% to $9.81 after it announced that the world’s second biggest shipping line will double the frequency of its Oceana Express Service to a weekly basis following positive feedback from customers.

The announcement comes after Mediterranean Shipping Company last month selected Tauranga as its only New Zealand port of call on the service which links the country with Australia and North and Central America.

Fletcher Building Ltd., the country’s biggest construction firm, rose 2.9% to $7.75.

Goodman Fielder Ltd., the Australian food ingredient maker, fell 14.7% to 60 cents as the stock resumed trading following the completion of the institutional component of its fully underwritten 5 for 12 pro-rata share offer.

The shares, offered at 45 Australian cents apiece, raised approximately A$190 million with a 93% take uptake by institutional investors, with the balance cleared in bookbuild at A$0.50 per share. The retail component of the offer opens Oct. 4.

“The market has raised a question mark over why Goodman is raising the money, and the suspicion is that they’re being pushed by their bank,” said Moore. “So what does the bank know that that we don’t know?”
Restaurant Brands NZ Ltd., the fast food franchise operator, fell 3.2% to $2.12.

Tower Ltd., the general insurer controlled by Guinness Peat Group, fell 2.1% to $1.39.

Rakon Ltd., the manufacturer of crystal oscillators used in electronics, fell 1.5% to 65 cents.

Bathurst Resources Ltd., the coal miner, was unchanged at 85 cents after it was reported that it had despatched its first export coal from the Cascade mine on the West Coast’s Denniston Plateau, with the first shipment through Westport due in November.

(BusinessDesk)

Content Sourced from scoop.co.nz
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