MARKET CLOSE: NZ shares up; F&P Healthcare, Auckland Airport gain, Steel & Tube falls

Thursday 1st September 2016

New Zealand shares rose as offshore investors looking for yield were lured to the local bourse. Fisher & Paykel Healthcare and Auckland International Airport led the index higher while Steel & Tube Holdings fell.

The S&P/NZX 50 Index rose 24.36 points, or 0.3 percent, to 7,423.19. Within the index, 24 stocks fell, 22 rose and five were unchanged. Turnover was $170.7 million.

"There's flow-driven movement from offshore - the desire to hide, invest, call it what you will, in New Zealand continues unabated," Matt Goodson, managing director at Salt Funds Management said. "It's always interesting when you see this growth from offshore investors, it tends to be the large cap stocks. We've just finished results season so it's very light on the ground for stock-specific news, we're really just driven by offshore flows. Our market's certainly at reasonably stretched levels of valuation."

F&P Healthcare gained 2.1 percent to $9.87 and Auckland International Airport rose 2 percent to $7.65.

Property stocks rose, with Kiwi Property Group up 1.9 percent to $1.58, Goodman Property Trust gaining 1.5 percent to $1.37, and Stride Property advancing 1 percent to $2.07.

"We have seen bonds sell off over the last couple of weeks, as the market has begun to move to the view that the Federal Reserve is more likely than not to tighten in September," Goodson said. "Property stocks around the world have been under a little bit of pressure by and large, certainly in Australia, so they seem to have been oblivious to that in New Zealand thus far."

Steel & Tube was the worst performer today, down 5.1 percent to $2.22. It's dropped 8.6 percent this week, following media reports that law firm Adina Thorn is launching a class action against steel mesh suppliers who have supplied products which don't meet the required earthquake standards. Steel & Tube is being investigated by the Commerce Commission over its claims that its products had been independently tested when they had not.

Metro Performance Glass fell 3.4 percent to $2.02, Chorus dropped 2.4 percent to $4.15, and Warehouse Group fell 2.1 percent to $2.83.

SkyCity Entertainment Group, which gave up rights to a 10.5 cent dividend, dropped 11 cents to $4.90 while NZX, which paid a 3 cent dividend, fell 2 cents to $1.02.

Outside the main index, Turners was unchanged at $3.05. The financial services firm extended its contract with Custom Fleet for a further three years to manage the sale of former lease vehicles of New Zealand's largest vehicle and equipment leasing company. The agreement extends an existing three-year partnership which covers some 4,000 vehicles a year, including the sale of all ex-lease vehicles as well as trucks and machinery from the commercial side of the business, Auckland-based Turners said in a statement. It didn't provide a value for the deal.

BusinessDesk.co.nz

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