MARKET CLOSE: Shares mixed; Skellerup falls, NZ Oil & Gas up

Tuesday 10th March 2009

Shares were mixed as a stronger oil price nudged NZ Oil & Gas higher while Skellerup Holdings tumbled.

The NZX 50 fell 6.47, or 0.3%, to 2462.706, its third daily decline. Within the index, 23 stocks fell, 19 gained and eight were unchanged. Turnover was NZ$74 million.

NZOG rose 4.4% to NZ$1.41 as crude oil gained on speculation supply reductions from Saudi Arabia will squeeze supplies as OPEC reduces output. Oil has gained almost 6% this year and was up 0.8% to US$47.44 a barrel on the New York Mercantile Exchange. Skellerup, which last month trimmed its forecast for full-year profit because of falling demand from automakers, fell 7.3% to 51.

Stocks were mixed across Asia today. Japan's Nikkei 225 Index fell 0.3% to 7064.27 in early afternoon trading while Australia's S&P/ASX 200 Index gained 0.5% to 3135.7, led by a 21% jump in Macquarie Office to 11 cents.

"There's still so much uncertainty about the `E' part of company P/Es," said Ian Waddell, managing principal at Waddell Johnston McCarthy. "The biggest issue is we're not in a conducive period for raising balance sheet strength."

Nuplex Industries, which is in talks with its banks over a breach of its covenants and may raise more capital, jumped 8.4% to NZ$1.03, having sunk 65% this year. The company "is at the mercy of its banks," Waddell said.

Pumpkin Patch, the children's clothing chain that expanded into the U.K and the U.S., fell 2.9% to NZ$1.01 amid concern the global outlook is worsening.

Warren Buffett, chairman of investment group Berkshire Hathaway, told CNBC that the U.S. economy "has fallen off a cliff" and the risk now is that efforts to revive growth will stoke inflation. Buffett's comments follow a World Bank report that predicted the entire global economy will contract this year for the first time since WWII as worldwide trade falls.

Fisher & Paykel Appliances declined 3.8% to 51 cents and has slipped 61% so far this year amid weakening demand for home appliances.

Sky Network Television fell 3.7% to NZ$3.70 after reports that state-owned Television New Zealand is negotiating a stake in TiVo, potentially giving the Freeview platform an alternative product to My Sky.

Waddell said trading is being driven by offshore order flows, with overseas investors pushing prices around as they reallocate within their portfolios.

Businesswire.co.nz

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