MARKET CLOSE: Commodiites and Wall Street help shares rise

Thursday 3rd June 2010

New Zealand shares rose, pushing the NZX 50 Index up for the first day in three, helped by stronger prices for farm commodities and as a rebound on Wall Street fed through into Asian equity markets.

The NZX 50 rose 5.2 points, or 0.2%, to 3024.10. Within the index, 27 stocks rose, 12 fell and 11 were unchanged. Turnover was $65.5 million.

Across Asia, Japan’s Nikkei 225 Index surged 3.2%, amid perceptions equity markets had weakened sufficiently to put value back in prices, and as the yen weakened against the euro. Hong Kong’s Hang Seng climbed 1.8% and Australia’s S&P/ASX 200 Index gained 2.4%.

NZ Farming Systems (NZX: NZS ) rose 4.7% to 45 cents, buoyed by stronger prices for dairy products. The ANZ Commodity Price Index rose to a record in both world and New Zealand dollar terms last month, according to a report yesterday.

“It’s so far so good, particularly with rural commodities, which have held up pretty well” said Grant Williamson, a director at Hamilton Hindin Greene in Christchurch.

Pan Pacific Petroleum (NZX: PPP ) rose 4% to 26 cents, helped by a rebound in energy shares in the US which sank earlier this week on the federal government’s announcement of a criminal probe into BP’s Gulf of Mexico oil leak.

AMP (NZX: AMP ) surged 4% to $7.10, leading gains in Australian financials that trade on the NZX. Westpac (NZX: WBC ) rose 3.2% to $28.40 and ANZ (NZX: ANZ ) rose 3.9% to $28.25.

NZX (NZX: NZX ) fell 1.9% to $1.58 after the country’s five top electricity generators said they would use the ASX to operate a new electricity forward market. NZX has been positioning itself to grow from new derivatives markets, and told an investor presentation in March that it was anticipating half of its revenues to come from derivatives trading in five years time.

“It has come as a surprise and investors in NZX will be extremely disappointed,” Williamson said. “It’s a real shame that it has gone this way, for New Zealand capital markets. ASX is very experienced through running the Sydney Futures Exchange.”

Pyne Gould (NZX: PGG ) fell 2.2% to 45 cents, snapping a two-day advance after the company announced it is in talks to team with Canterbury Building Society and Southern Cross Building Society for a merger that could create a bank with $2.2 billion of assets. A spokesman for the Reserve Rank was reported as saying registering a bank is a long process that could take three years.

Guinness Peat Group (NZX: GPG ) rose 2.9% to 70 cents. GPG has lifted its stake in Ridley, Australia’s biggest producer of refined salt, spending some A$18 million over the past fortnight.

Port of Tauranga (NZX: POT ) stock rose 0.9% to $6.70 after the port operator announced a hearing panel would recommend Conservation Minister Kate Wilkinson grant it permission to widen and deepen its harbour shipping channels in preparation for the arrival of larger container vessels.

Telecom (NZX: TEL ) fell 1.6% to $1.83. The company is launching a new advertising campaign fronted by chief executive Paul Reynolds to win customers back to its XT network that was marred by outages this year.

Rakon (NZX: RAK ) fell 1.1% to 89 cents and Sky City Entertainment Group (NZX: SKC ) fell 1% to $2.85.

Kathmandu (NZX: KMD ) rose 2.7% to $1.90 and clothing chain Hallenstein Glasson (NZX: HLG ) rose 1.5% to $3.35.

Businesswire.co.nz

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