MARKET CLOSE: NZ shares fall a 2nd day; Chorus extends slide

Article – BusinessDesk

Dec. 4 (BusinessDesk) – New Zealand shares fell for a second day, retreating from a five-year high as Chorus extended its slide on concerns about price regulation and Xero fell from a record high.

MARKET CLOSE: NZ shares fall a second day as Chorus extends slide, Xero drops

Dec. 4 (BusinessDesk) – New Zealand shares fell for a second day, retreating from a five-year high as Chorus extended its slide on concerns about price regulation and Xero fell from a record high.

The NZX 50 Index dropped 33.396 points, or 0.8 percent, to 4015.69. Within the index, 29 stocks fell, nine rose and 12 were unchanged. Turnover was about $190 million, with heavy turnover in Chorus for a second day.

Equity markets generally fell across the Asia-Pacific region following unexpectedly weak US manufacturing and concerns the US Congress won’t find a way to head off the fiscal cliff.

Xero, the cloud-based accounting service, dropped 9.1 percent to $7 having soared yesterday after two US funds bought shares, giving the unprofitable company enough cash for three years as it chases global sales.

Chorus, the network company spun off from Telecom last year, fell 4.5 percent to $7, adding to yesterday’s 14 percent decline. About 11.5 million shares changed hands. Moody’s Investors Service said today it may cut the Baa2 credit rating on some US$2 billion of the company’s debt because of the impact of Commerce Commission’s draft plan to curb prices it can charge rivals.

“This is a pretty material outcome for Chorus and a very big hit on its ebitda,” said James Lindsay, equities manager at Tyndall Investment Management. “It is essential it does get reviewed.”

Telecom fell 1.9 percent to $2.27 and Sky Network Television declined 2.1 percent to $5.15.

OceanaGold, the operator of the Macraes gold field, was unchanged at $4.10 after announcing plans to raise up to C$108 million in a fully-underwritten share issue to repay debt and bolster its balance sheet.

Delegat’s Group fell 1.6 percent to $3.05 after flagging a small increase in annual earnings for 2013, while warning that the strong kiwi dollar is making life hard for the wine-maker

Among smaller stocks, upscale Wellington retailer Kirkcaldie & Stains was unchanged at $3.05 after saying a mystery buyer for its Harbour City Centre on Wellington’s Lambton Quay has walked away after deciding the building wasn’t the right fit as an investment.

Ebos Group, the medical consumables and petfood group, rose 2.1 percent to $8.47, the biggest advance on the NZX 50 today. Infratil rose 1.5 percent to $2.34 after adding a UK-based investment specialist to its board.

Cavalier, the carpet maker, dropped 3.5 percent to $1.67. SkyCity Entertainment Group, the hotel and casino company, fell 1.9 percent to $3.65

(BusinessDesk)

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