Monday 6th July 2009
|Text too small?|
New Zealand shares fell in light holiday trading amid expectations earnings stayed weak in the second quarter and as companies including Auckland International Airport signalled they’re still feeling the effects of the global downturn.
Auckland Airport (NZX: AIA ), the country’s biggest gateway, sank 3.2% to a six-year low of $1.51 after announcing it will cut international landing fees by 5% and abandon plans to raise domestic charges as the global downturn in demand for air travel erodes airline profits.
Air New Zealand (NZX: AIR ) dropped 3.3% to 87 cents, the lowest close since March 12.
The airport faces “slowing traffic and regulatory issues,” said Rickey Ward, who helps manage $400 million at Tyndall Investment Management. “People have got upset about a short-term piece of information,” he said. Still, Auckland Airport “is one of those companies that come up on the radar as being undervalued” and its decline today offers “a better opportunity to invest.”
Methven (NZX: MVN ) fell 3.7% to $1.30, leading the NZX 50 lower, after the manufacturer of taps and bathroom fittings said it faces prosecution by the Commerce Commission after a competitor laid a complaint about advertising claims over its Satinjet twin jet showerware technology.
“We have cooperated fully with all aspects of the investigation,” said chief executive Gary Nel in a statement. The company said it is disappointed with the regulator’s decision to proceed with the action.
Fisher & Paykel Appliances (NZX: FPA ) declined 2.9% to 66 cents after the appliances manufacturer completed a top-up issue of shares to new cornerstone investor Haier Group.
Investors are awaiting the release tomorrow of the New Zealand Institute of Economic Research’s Quarterly Survey of Business Opinion, which will provide a clues to the track of corporate earnings and hiring intentions.
ING New Zealand expects companies in the NZX 50, on average, to post a 4.2% decline in second-quarter per-share earnings. The results season kicks off next month.
“The market is jittery still,” Tyndall’s Ward said. It’s “sitting on a fine edge waiting for the results season.”While people are “searching for good snippets of news, all the bad news is not over” with unemployment set to peak at 7.5% in the middle of next year, from 5% currently, he said.
Also out tomorrow, the Reserve Bank of Australia’s review of monetary policy is expected to result in no change to its benchmark interest rate of 3%.
The NZX 50 Index fell 18.53, or 0.7%, to 2742.97, the fourth daily decline. Within the index, 19 stocks fell, 12 rose and 20 were unchanged. Turnover was just $38 million, making it one of the quietest trading days this year.
No comments yet
MARKET CLOSE: Telecom and Air New Zealand gain
MARKET CLOSE: NZX 50 snaps 4-day slide as earnings awaited; Mainfreight gains
MARKET CLOSE: Shares fall with global slide; Rakon, Nuplex fall
MARKET CLOSE: Pumpkin Patch slips as investors mull downsizing
MARKET CLOSE: Weaker building stats weigh on Fletcher Building
MARKET CLOSE: Telecom and Contact Energy make gains
MARKET CLOSE: NZ shares mixed, FPA, Sky City fall, Rakon gains
MARKET CLOSE: NZ shares gain; Telecom lifts on Chorus, Sky City gains
MARKET CLOSE: NZ shares fall a second day; Wrightson drops on forecast
MARKET CLOSE: NZ shares slide; Pike, Fletcher, Rakon fall