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MARKET CLOSE: NZ shares gain as growth stocks recover; Comvita bounces

Friday 7th June 2019

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New Zealand shares rose, led by growth stocks Synlait Milk and Fisher & Paykel Healthcare. Comvita soared on news its former chief executive will put its under-performing units under the microscope. 

The S&P/NZX 50 Index increased 30.94 points, or 0.3 percent, to 9,987. Within the index, 24 stocks rose, 17 fell, and nine were unchanged. Turnover was $108.9 million. 

Synlait led the market higher, up 2.5 percent at $8.75 on a volume of 189,000 shares, slightly more than its 90-day average of 121,000 shares. The gain ended four straight declines, rising from a six-month low. The milk processor often tracks with A2 Milk, which it supplies, but has also been beset by a covenant that may prevent it from opening a second factory. A2 was up 0.2 percent at $14.28. 

Among other growth stocks lifting the index higher, Fisher & Paykel Healthcare rose 2.4 percent to $15.45, and Tourism Holdings was up 1.9 percent at $3.82. Gentrack Group increased 1.2 percent, or 6 cents, to $5.30 after shedding rights to a 5 cent dividend. 

Outside the benchmark index, Comvita soared 13 percent to $3.52, extending a recovery from a five-year low. Chief executive Scott Coulter today signalled his exit, and former CEO Brett Hewlett will take on a temporary executive role to run the ruler of the honey products maker's under-performing units. 

"Finally we've got some news for investors - it's more on a promise than anything too substantial, but the share price is tracking up," said Grant Davies, an investment advisor at Hamilton Hindin Greene. 

NZX was unchanged at $1.05 on an unusually large volume of 1.5 million shares after its Smartshares unit listed eight new exchange-traded funds. Among the ETFs, which are backed by global asset manager BlackRock, were two thematic funds. The Smartshares Health Innovation Fund rose 0.9 percent to $2.33, while the Smartshares Automation and Robotics ETF increased 0.9 percent to $2.70. 

Davies said the new thematic ETFs will give investors some interesting areas to get exposure. 

"From the NZX's position, even through it owns the products, it's nice to have something new," he said. 

Goodman Property Trust was the most traded stock on a volume of 2.4 million units, more than twice its 850,000 average. It fell 1.1 percent to $1.81. Spark New Zealand decreased 0.8 percent to $3.675 on a volume of 2.4 million shares, less than half its usual volume. 

Kiwi Property Group fell 1.9 percent to $1.53, the day's biggest decline, on a volume of 1.2 million shares. 

Among other stocks trading on volumes of more than a million shares, Air New Zealand decreased 0.4 percent to $2.57, Auckland International Airport was unchanged at $8.82, Mercury NZ slipped 0.4 percent to $3.885, Genesis Energy was unchanged at $3.10, and Meridian Energy increased 1.6 percent to $4.35. 

Of stocks going ex-dividend, Investore Property fell 1.1 percent, or 2 cents, to $1.76 shedding rights to a 1.94 cent dividend, Sanford fell 0.9 percent, or 6 cents, to $6.94 shedding rights to a 9 cent dividend, and Ryman Healthcare was down 0.9 percent, or 10 cents, giving up rights to an 11.9 cent dividend. 

Fonterra Shareholders' Fund units increased 0.3 percent to $4 and Fonterra Cooperative Group's farmer-only shares fell 0.3 percent to $4 after Agriculture Minister Damien O'Connor outlined plans to change the dairy sector's governing legislation. Among the changes, Fonterra will be able to veto some applications under its open-entry provision to accept all milk supply. Another will see the minister nominate a member of the milk price panel. 

Bank of New Zealand's 2020 bond paying annual interest of 4.43 percent was the most traded debt security on a volume of 475,000 notes. It closed at a yield of 1.76 percent, down 4 basis points. 


Bond Offer: Infratil Ltd, 7.2 year & 10.2 year unsecured unsubordinated bond

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