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MARKET CLOSE: NZ stocks mixed, PGG Wrightson up, Goodman down

Wednesday 1st December 2010

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New Zealand stocks were mixed as the negative sentiment on global markets and softer GDP figures in Australia was offset by an improvement in commodity prices. PGG Wrightson paced gainers on the day, while Goodman Fielder fell.

The NZX 50 Index rose 0.59 points, or 0.01%, to 3,265.09. Within the index, 18 stocks gained, 19 declined and 13 were unchanged. Turnover was $83.3 million.

Wrightson (NZX: PGW ) rose 6.5% to 49 cents.

Goodman Fielder (NZX: GFF ) fell 2.8% to $1.77, which Shane Solly, portfolio manager at Mint Asset Management, said was due to pressure from rising input prices and a wet season in Australia which had hurt wheat crops.

New Zealand's commodities climbed to a new high as 10 of the 15 measured raw materials in the ANZ Commodity Price Index gained in November. The index rose 4.5% to 296.2 with soft commodities enjoying a renaissance this year.

The economy of Australia, New Zealand biggest trading partner, grew at a slower-than-expected pace in the third quarter as exports came off the boil in the period. Australia's gross domestic product grew 0.2% in the three months ended September 30, according to the Australian Bureau of Statistics, below the 0.5% pace expected in a Reuters survey.

"Globally uncertainty has crept back in, and in that context we've done relatively well," Solly said. "I don't think people should expect a straight path to a recovery, it will remain mixed for some time."

Ebos (NZX: EBO ) rose 3.1% to $7.75 and TrustPower (NZX: TPW ) rose 2.2% to $7.44.

Contact Energy (NZX: CEN ) rose 0.8% to $5.98, after the Environment Court granted approved all the consents and turbine locations the company sought for its proposed Waitahora wind development in southern Hawke's Bay.

The proposed project in the Puketoi Range, southeast of Dannevirke, would generate enough electricity for up to 70,000 average homes. The wind resource on the Puketoi Range was world class and the decision of the court confirmed that the relatively remote site was ideal for a wind farm in nearly every respect, Contact said.

APN News & Media (NZX: APN ) fell 3.6% to $2.41, pacing decliners on the day. Kathmandu (NZX: KMD ) fell 3.6% to $1.62, and Pyne Gould (NZX: PGC ) fell 2.6% to 37 cents.

Air New Zealand (NZX: AIR ) was unchanged at $1.38 after Malaysian-based airline AirAsia X launched a service providing low cost flights to Asia out of Christchurch, which is expected to undercut existing fares by as much as 50%.

"This not a new announcement, and something the industry has been aware of for some time now," said Solly. "It is the nature of the industry, people come in and have a go, and it will be interesting to see how much traffic they get between Christchurch and Kuala Lumpur."

New Zealand Oil & Gas (NZX: NZO ) fell 2.2% to 90 cents, after reports that the coal miner could be forced to close for the duration of an inquiry into the explosions which killed 29 miners.

Kiwifruit growers Satara (NZX: SAT ) and Eastpack have canned a proposed merger, with Eastpack's credit lines drying up after the outbreak of Pseudomonas syringae pv actinidiae.

Satara said its board is condiment it pursued all avenues to keep the deal afloat, but wasn't able to achieve this. Its balance sheet is relatively strong after a property sale earlier this year, and it predicts the impact of the Psa bacteria will be minimal.

Trading in Satara's shares came off a halt after the close, and last at $1.00 on September 10.

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