Thursday 18th April 2013
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New Zealand shares rose as persistently low interest rates globally polished the appeal of equities and drew investors to companies with consistent earnings such as Ryman Healthcare and Port of Tauranga.
The NZX 50 rose 50.43 points, or 1.1 percent, to 4478.26. Within the index, 41 stocks rose, five fell and four were unchanged. Turnover was $160 million and reflected higher-than-average trading in Ryman, Sky Network Television, Fisher & Paykel Healthcare and Michael Hill International.
Shares rebounded from Tuesday's selloff, which had been driven by weaker-than-expected economic growth out of China. Stepping back, investors took the Chinese data as a sign major economies would keep their stimulus programmes in place for longer, adding to the appeal of equities, said Greg Easton, adviser at Craigs Investment Partners.
"People are looking for quality investments," Easton said. With Ryman and Port of Tauranga, it's not really today's earnings you're buying for but down the track. They have consistent earnings."
Ryman, the retirement village operator, rose 3.2 percent to $5.52, a record close. The company, which has enjoyed an uninterrupted run of earnings growth, is up 73 percent in the past 12 months. Rival rest home company Summerset Group rose 1 percent to $2.92.
Port of Tauranga, the nation's busiest export port, climbed 3 percent to a record $15.25 and is up by a third in the past year. The company posted its highest-ever first-half earnings in February. Mainfreight, the transport group, rose 1.3 percent to $10.76.
The drive for certainty of returns has also lifted property stocks, Easton said. Argosy Property rose 2.9 percent to $1.05 and Goodman Property climbed 2.3 percent to $1.135. Kiwi Income property Trust rose 1.3 percent to $1.215.
Fisher & Paykel Healthcare, which gets more than 50 percent of sales in US dollars, gained 1.6 percent to $2.56 as the kiwi dollar fell back below 85 US cents.
NZ Oil & Gas, which has fallen with the price of crude oil, rose 4.9 percent to 86 cents today. OceanaGold, which has been punished as the price of gold plummeted to a two-year low, extended its slide with a 3.8 percent drop to $2.31, even as spot gold rose from its lows in Asia.
Fletcher Building, the biggest company on the NZX 50, rose 0.4 percent to $8.48. Sky TV rose 0.4 percent to $5.34, with 5.6 million shares changing hands. Volumes in the stock have increased since News Corp sold its stake, boosting liquidity.
Telecom rose 0.6 percent to $2.455.
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