Article – BusinessDesk
Jan. 11 (BusinessDesk) New Zealand shares rose for a fifth straight session, as the local market continued to bask in its status as relatively high yielding in an economy thats growing modestly. Skellerup Holdings and Cavalier led gainers …
MARKET CLOSE: NZ shares rise for fifth session; Skellerup, Cavalier lead
Jan. 11 (BusinessDesk) – New Zealand shares rose for a fifth straight session, as the local market continued to bask in its status as relatively high yielding in an economy that’s growing modestly. Skellerup Holdings and Cavalier led gainers and Fletcher Building reached a 19-month high.
The NZX 50 rose 12.67 points, or 0.3 percent, to 4131.754, a new five-year high. Within the index, 31 stocks rose, 12 fell and seven were unchanged. Turnover was $90.9 million.
Skellerup, a manufacturer of milking equipment and rubber goods, rose 1.9 percent to $1.64. The stock has a dividend yield of 7.3 percent. Cavalier, a carpet maker set to benefit from the Christchurch rebuild and a pick-up in building activity, rose 1.8 percent to $1.71.
“Very low interest rates have forced people into stocks to find yield,” said Matt Goodson, portfolio manager at BT Funds Management. “The market started last year significantly under-valued. Now it’s fair value.”
Telecom rose 0.4 percent to $2.31. The stock has a dividend yield of about 13 percent.
Fletcher, the biggest company on the NZX 50, rose 0.6 percent to $8.72, the highest since June last year. The company is rated ‘outperform’ based on the consensus of 11 recommendations compiled by Reuters.
Michael Hill International fell 3.2 percent to $1.21 after the jewellery chain said sales growth stalled in the second quarter, which limited earnings growth in the first half of the year.
“December quarter sales, including the critical Christmas trading period, fell short of our forecasts and didn’t deliver the improvement over last year that the company had expected,” the Brisbane-based company said in a statement.
Goodson said investors are on watch for any other company that come out ahead of earnings season with updated guidance.
Units of the Fonterra Shareholders’ Fun rose 0.6 percent to $7.31. The fund will join the NZX 50 on Jan. 21, replacing Cavalier, according to an NZX statement that came out after the close of trading.
APN News & Media, which publishes the New Zealand Herald, rose 5.9 percent to 36 percent on the NZX.
Vital Healthcare climbed 1.6 percent to $1.26. Nuplex Industries rose 1.6 percent to $3.21.
Trade Me, the auction website, gained 1.5 percent to $4.04 and courier company Freightways rose 1.4 percent to $4.38. Contact Energy, the biggest power company on the NZX 50, was unchanged at $5.15.