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MARKET CLOSE: NZ shares drop as Sky TV, NZX fall; Vector, Chorus gain

Thursday 30th August 2018

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New Zealand shares dropped from yesterday's record, led lower by Sky Network Television and NZX. Vector and Chorus gained.

The S&P/NZX50 Index fell 22.79 points, or 0.2 percent, to 9,339.88. Within the index, 30 stocks fell, 13 rose and seven were unchanged. Turnover was $129.55 million.

"The market is up 3.5 percent for the month which is a huge move. It has been driven by the growth stocks and we are seeing a lot of buying coming from offshore," said David Price, broker at Forsyth Barr. "The local market is short of a lot of names that keep being bought, so that accentuates the movement that we're seeing."

"Given the magnitude of the move yesterday, to be pretty largely flat on the day is a pretty good performance."

Sky Network Television was the worst performer, down 4.2 percent to $2.30. Last Friday, the pay-TV operator wrote down its value by $360 million at the end of its financial year, resulting in a $240.7 million annual loss.

NZX dropped 3.2 percent, or 3.5 cents, to $1.07 as it gave up rights to a 3 cent interim dividend and 1.5 cent special dividend.

Tourism Holdings fell 3.2 percent to $5.81. It reported a record June year net profit of $62.4 million on Tuesday, of which $23.1 million was an accounting gain on setting up its TH2 joint venture with RV maker Thor Industries. The company said it will step up investment in the JV which will stop it from repeating another year of record profits.

"The result itself was probably a tad on the soft side, and the briefing left people a bit unclear and markets like certainty. There's a lot going on at THL, and there's a lack of clarity about what it is," Price said. 

Vector was the best performer, up 1.8 percent to $3.48. It has agreed to buy Vircom Energy Management Services to help maintain a national service for residential and commercial smart meters.

Chorus rose 1.4 percent to $4.62 and Fonterra Shareholders Fund gained 1.2 percent to $5.04.

Outside the benchmark index, Veritas Investments rose 33.3 percent to 12 cents. It reported a June year profit due to the $6.3 million gain from selling the Mad Butcher franchise, though its auditors couldn't confirm that figure. Its only remaining business wrote down $1.2 million in goodwill and assets.

Wellington Drive Technology was unchanged at 18.1 cents. It reported a net loss of $200,000 for the half-year ended June 30, from a $500,000 loss for the same period last year.

(BusinessDesk)

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