MARKET CLOSE: NZ shares fall; Sky TV drops on downgrade; Fletcher gains from lows

Friday 21st October 2011

New Zealand shares fell after an afternoon profit downgrade from Sky Network Television, which weighed on the NZX 50 Index on the final day of trading before a local three-day sporting holiday weekend.

The NZX 50 Index fell 8.61 or 0.26 per cent, to 3281.85. Within the index, 19 stocks fell, 15 rose and 16 were unchanged. Turnover was $80.3 million.

Sky TV today became the fifth NZX 50 company to give a profit downgrade in the past two weeks. The economy barely grew in the second quarter and the Canterbury earthquake has disrupted operations for companies including Restaurant Brands.

Sky TV fell 4.8 percent to $5.38 after forecasting profit for 2012 that missed analyst estimates. The pay-TV company told shareholders at their annual meeting today that capital spending costs will be higher than expected.

“There have been a lot of meetings lately and investors are keeping a close eye on the outcomes to see how shareholders are reacting,” said David Colman, head equities dealer at ANZ Bank’s Direct Broking unit.

Fletcher Building rose 1.1 percent to $6.41, clawing back a small portion of the 20 percent value shed since last week’s warning that first-half profit would decline and full-year earnings growth would stall.

“Fletcher had a stronger close after its share prices plunged after the announcement last week,” Colman said.

Shares across Asia were mixed today following modest increases on Wall Street and continued uncertainty ahead of this weekend’s European Union Summit when leaders will attempt to reach agreement on a solution to the region’s debt crisis.

The S&P/ASX 200 Index took its cue from Wall Street, making moderate gains. Australia’s energy stocks were the best performer as Brent crude rose, though falling metal prices overnight led to a drop in the materials sector.

NZ’s OceanaGold, which operates the Macraes gold field, was unchanged after tumbling 9.7 percent to $2.80 yesterday.

(BusinessDesk)

BusinessDesk.co.nz

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