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MARKET CLOSE: NZ shares fall; F&P Healthcare, Ebos drop while Air NZ, NZX gain

Monday 3rd July 2017

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New Zealand shares fell in light trading, with Fisher & Paykel Healthcare giving back some of its June gains while Air New Zealand and NZX rose.

The S&P/NZX 50 Index dropped 23.01 points, or 0.3 percent, to 7,588.43. Within the index, 23 stocks fell, 18 rose and 9 were unchanged. Turnover was $105 million.

"It has been a quiet period, we haven't been getting earnings through and haven't had many leads from overseas either, but it has been a reasonable period for the NZX," Grant Davies, investment adviser at Hamilton Hindin Greene said.

The index reached a record high last Thursday, just before the end of the second quarter, and has gained 10.3 percent so far this year.

F&P Healthcare led the index lower, down 2 percent to $11.22. The stock reached a record $11.57 last Thursday and has gained 34 percent this year, so some profit-taking was to be expected following that run, Davies said.

Ebos Group dropped 1.8 percent to $17.19, Chorus fell 1 percent to $4.585 and Vital Healthcare Property Trust declined 0.9 percent to $2.24.

Air New Zealand was the best performer, up 1.2 percent to $3.30, while Comvita rose 0.9 percent to $5.85.

NZX gained 0.9 percent to $1.13. First NZ Capital has nudged up its 12-month target price on the stock on a small upgrade to its earnings forecasts after last week's annual meeting and is closely watching for the outcome of the stock exchange operator's review of its businesses. 

On Friday, NZX affirmed 2017 guidance for earnings before interest, tax, depreciation and amortisation (ebitda) of $27 million-to-$30 million after ebitda jumped 30 percent in the first five months of the year. Wellington-based NZX noted if the current relatively subdued capital raising and securities trading conditions persist, it expects earnings to be in the middle of guidance but if conditions improve, it would deliver a result at the upper end. 

"They've had major issues over the last few years, really cleaning out all the dead wood," Davies said. "They've put all that behind them and they've had a little bit of increased earnings guidance, which is positive. A few brokerages have given slight upgrades on their forecasts. It will be interesting to see if they can come up with a way for smaller players to get involved in the listed markets. 


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