CLOSE: NZ shares rise a fifth day; Sky City gains as value seen

Monday 20th July 2009

New Zealand shares rose for the fifth straight day, pushing the benchmark NZX 50 Index to its highest level in more than a month, as some early earnings out of the U.S. beat expectations and investors await local second-quarter results. Sky City Entertainment Group gained on perceptions it is relatively cheap.

Turnover was just $56 million, continuing a pattern of light trading volumes in the run-up to the earnings season. The NZX 50 climbed 12.69, or 0.5%, to 2820.91. Within the index, 27 stocks rose, 14 fell and 10 were unchanged.

“A lot of people have paused, and have got their positions in New Zealand covered,” said Alan Moore, who helps oversee $250 million at Milford Asset Management. “People are looking for evidence.” Companies have strengthened their balance sheets and now investors want to know how they’ll spend it, he said.

Sky City (NZX: SKC ) rose 2.9% to $2.86. The casino and hotel group in April forecast annual profit of $99 million to $106 million, down from $111.9 million a year earlier, excluding the cinema write-down. The stock is rated ‘outperform’ based on the consensus of nine analysts polled by Reuters. Four rate it a ‘buy.’

NZ Farming Systems Uruguay (NZX: NZS ) gained 4.3% to 49 cents, leading the index higher.

Delegat’s Group (DGL), which makes Oyster Bay brand wines, jumped 4.9% to $2.15 after the company said full-year profit climbed at least 58%, reflecting a pick-up in sales in the fourth quarter and adjustments to the fair value of currency hedge contracts. Net profit was $30 million to $31 million in the 12 months ended June 30, up from $19.1 million a year earlier, the company said in a statement, citing unaudited figures.

APN News & Media (NZX: APN ), publisher of the New Zealand Herald, gained 2.8% to $1.85, leading gains in Australian stocks that also trade on the NZX as the S&P/ASX 200 Index advanced.

Stocks rose in Australia, as higher prices for metals and oil lifted BHP Billiton 2.5% to A$36.08 and Rio Tinto gained 2.3% to A$53.71. Building supplies group James Hardie Industries NV rose 5.6% to A$4.33 after U.S. figures showed a jump in housing starts.

On the NZX, Fletcher Building (NZX: FBU ) slipped 0.2% to $6.82 and is up 7% in the past month.

“Fletcher continues to be reasonably favoured,” Milford’s Moore said.

Among other Australian shares on the NZX, Telstra Corp (NZX: TLS ) rose 2.4% to $4.25 and insurer AMP Ltd (NZX: AMP ). rose 1.5% to $6.25.

New Zealand Oil & Gas (NZX: NZO ) climbed 1.9% to $1.60 as crude oil advanced for a fourth day, helped by stronger equities and signs of increased demand in China. Crude oil for August delivery was at US$64.02 in Singapore time, bringing oil’s advance this year to 44%.

OceanaGold Corp (NZX: OGC ). rose 3.6% to $1.45 as gold for immediate delivery gained 0.5% to US$941.97 an ounce in Singapore. New Zealand Mint Ltd. today said the precious metal may extend its 6.9% gain this year as investors ponder the prospects of a resurgence of inflation and traders in India prepare for the traditional wedding season.

Foodmaker Goodman Fielder (NZX: GFF ) led decliners, falling 4.2% to $1.58, while Fisher & Paykel Appliances (NZX: FPA ) dropped 2.8% to 69 cents. Mainfreight Ltd (NZX: MFT ) declined 0.7% to $4.07 as the price of crude oil advanced.

Businesswire.co.nz

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