Business Scoop
Network

MARKET CLOSE: NZ shares rise as Fletcher extends gain

Article – BusinessDesk

May 23 (BusinessDesk) – New Zealand stocks rose, led higher by Fletcher Building as the construction company extended a recent rally. Metro Performance Glass jumped 13 percent after meeting its downgraded earnings guidance.MARKET CLOSE: NZ shares rise as Fletcher extends gain; Metroglass jumps

By Paul McBeth

May 23 (BusinessDesk) – New Zealand stocks rose, led higher by Fletcher Building as the construction company extended a recent rally. Metro Performance Glass jumped 13 percent after meeting its downgraded earnings guidance.

The S&P/NZX 50 Index increased 25.93 points, or 0.3 percent, to 10,263.41. Within the index, 20 stocks rose, 22 fell, and eight were unchanged. Turnover was $102 million.

Fletcher rose 3 percent to $5.46 on a volume of 2.5 million shares, more than twice its 90-day average of 1.2 million. The country’s biggest listed building company has climbed 6.8 percent since May 17, when a Deloitte report showed building material costs for residential construction were lower than is often claimed.

Grant Williamson, a director at Hamilton Hindin Greene, said the company still has a way to go in regaining investor confidence after its slump last year. He warned the current environment for the sector remains tough, pointing to Steel & Tube Holdings’ earnings downgrade on Monday.

“That sector still has quite a few headwinds,” he said. Steel & Tube was unchanged at $1.03, having dropped from $1.23 before cutting its earnings outlook.

Outside the benchmark index, Metro Performance Glass rose 5 cents to 45 cents. It reported a 69 percent slide in annual profit and met its downgraded earnings guidance, as the glass products maker struggles with issues at its Australian business.

Williamson said the company has been a big underperformer for some time, but that investors appeared to be encouraged by the new management team’s plans to turn it around.

Spark New Zealand was the most traded stock on a volume of 3.4 million shares, less than its 5.8 million average. The telco rose 0.5 percent to $3.80. Today, it received a warning from the Commerce Commission over the way it raised broadband prices on copper-based broadband last year, without telling customers they could cancel their agreements.

Chorus, the telecommunications network operator, fell 0.9 percent to $5.71, extending this week’s decline after investors were wary over the Commerce Commission’s consultation on proposed input methodologies for the fibre network.

Chorus’s 2028 bonds paying annual interest of 4.35 percent were the most traded debt security. They closed at a yield of 3.31 percent, down 5 basis points, on a volume of 507,000 notes.

Argosy Property fell 1.8 percent to $1.35 on a volume of 1.1 million shares, more than its 456,000 average. It reported a 36 percent increase in annual profit and is paying a bigger dividend than previously signalled.

Williamson said Argosy had benefited from strong investor demand for companies paying reliable dividends, and that the stock had come off a record high.

Among yield stocks that gained today, Precinct Properties New Zealand was up 1.8 percent at $1.69, Contact Energy rose 1.4 percent to $7.35, Auckland International Airport increased 1.3 percent to $8.65 and Stride Property increased 0.9 percent to $2.15.

Kiwi Property Group fell 0.3 percent to $1.545 on a volume of 1.8 million shares. New Zealand Refining rose 0.5 percent to $2.07 on an unusually large volume of 1.1 million shares compared to its average of 194,000.

Sanford fell 0.4 percent to $6.75 on a typically small volume of 36,000 shares. It reported an 8 percent decline in first-half earnings after the death of a crew member kept one of its deep sea vessels in port for three months.

Gentrack Group posted the biggest decline, down 3.1 percent at $5.58 on a volume of 18,000 shares, less than its usual volume of 76,000. The utilities software developer will report first-half earnings tomorrow.

Freightways fell 1.1 percent to $8.65 after saying a slowdown in its express packaging unit posed a risk to the 2020 financial year.

Fonterra Shareholders’ Fund units increased 0.5 percent to $4.22, and Fonterra’s farmer-owned shares were up 0.2 percent at $4.22 after the cooperative cut its earnings guidance and narrowed its forecast range for the farmgate payout. Fonterra also said it may sell other assets as it continues to reshape itself under the new leadership team of chief executive Miles Hurrell and chair John Monaghan.

Michael Hill International fell 1.7 percent to 57 cents, with 5.2 million shares changing hands, compared to the 814,000 average.

Zespri Group shares, which traded on the Unlisted exchange, rose to $7.50 from $7.20. The kiwifruit marketer lifted annual profit 77 percent on increased global sales and higher licensing fees. It also intends to pay a bigger dividend.

(BusinessDesk)

Content Sourced from scoop.co.nz
Original url