Article – BusinessDesk
Jan. 10 (BusinessDesk) New Zealand shares rose, pushing the NZX 50 Index to a new five-year high, as expectations of a pickup in building activity lifted companies such as Fletcher Building, Steel & Tube Holdings and Cavalier. PGG Wrightson …
MARKET CLOSE: NZ shares rise to new 5-year high; Fletcher, Steel & Tube gain
Jan. 10 (BusinessDesk) – New Zealand shares rose, pushing the NZX 50 Index to a new five-year high, as expectations of a pickup in building activity lifted companies such as Fletcher Building, Steel & Tube Holdings and Cavalier. PGG Wrightson rose to a 17-month high.
The NZX 50 rose 15.54 points, or 0.4 percent, to 4119.08, the highest since November 2008. Within the index, 27 stocks rose, 19 fell and four were unchanged. Turnover was $103.8 million.
Fletcher Building, the biggest company on the exchange, gained 2.6 percent to $8.67, the highest since June last year. The nation’s biggest construction and building materials firm has gained amid signs of life returning in the Australian home building market. Figures today showed building approvals across the Tasman in November were up 13.2 percent from a year earlier.
“There’s a lot of expectation of improved residential activity in Australia, which has been a bit rough,” said Shane Solly, portfolio manager at Mint Asset Management. Investors are also been drawn to the stock market in search of yield in the face of low returns on offer from fixed income, he said.
Steel & Tube, which sells steel building materials, gained 0.8 percent to $2.43, Cavalier, the carpet maker, rose 1.8 percent to $1.68.
Fast-food chain operator Restaurant Brands rose 1.8 percent to $2.85, leading gains among stocks with relatively high dividend yields. The company has a dividend yield of 8.68 percent.
TrustPower, which has a dividend yield of 7.2 percent, rose 1.4 percent to $8.50. Telstra Corp, with a dividend yield of 9.2 percent, rose 1.1 percent to $5.66 on the NZX.
“In the global beauty contest New Zealand still rates reasonably well,” Solly said. “Versus fixed interest, equities look pretty attractive.”
Wrightson, the nation’s biggest rural services company, rose 4.3 percent to 49 cents, helped by renewed optimism in the farming sector and the publicity from Fonterra Cooperative Group’s sale of units last year. Figures today showed New Zealand’s commodity export prices rose for the fifth straight month in December.
Pumpkin Patch, the children’s clothing chain, rose about 3 percent to $1.39, the highest since Dec. 12.
OceanaGold, operator of the Macraes gold field, fell 3.8 percent to $3.30, the biggest percentage drop on the NZX 50.
Nuplex Industries led manufacturers lower, falling 1.3 percent to $3.16 as the New Zealand dollar rose back above 84 US cents, eroding the value of overseas sales. Skellerup Holdings fell 1.2 percent to $1.61. Rakon fell 2.7 percent to 36 cents.