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MARKET CLOSE: NZ shares fall as Asia-Pacific region prepares for US earnings

Tuesday 12th January 2010

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New Zealand shares fell for a second day in a row as stock markets were down around Asia and the Pacific ahead of the fourth-quarter earnings season in the US next week.

The NZX 50 Index dropped 13.45, or 0.4%, to 3290.29. Within the index 22 stocks declined, 11 were unchanged, one didn’t trade and 16 increased. Turnover was $96.9 million. 

Australia’s S&P/ASX 200 fell 0.9% to 4906.50 while Hong Kong’s Hang Seng eased 0.5% to 22,296.28 and Japan’s Nikkei 225 rose 0.2% to 10,823.87 after aluminium producer Alcoa missed analysts’ expectations when it posted a net loss of US$277 million, or 28 cents per share, in the three months ended December, compared to a US$1.19 billion loss a year earlier.  

“The US heads into reporting season next week and people are reviewing their approach,” said Rickey Ward, equities manager at Tyndall Investment Management. “It will set the tone for global markets for the next quarter at least.”  

Auckland International Airport (NZX: AIA ) led the index lower for the second day in a row, falling 3% to $1.96 as investors continued to digest yesterday’s announcement that the airport has bought a 24.55% stake in two North Queensland airports.

Ward said there were still unanswered questions about the move which will hang in the air until its next result.  

“Most investors are in Auckland Airport for its own airport,” not to get exposure to others, he said.  

The national carrier Air New Zealand (NZX: AIR ) dropped 1.7% to $1.18. NZ Farming Systems Uruguay (NZX: NZS ) extended its losses falling 2% to 48 cents while rubber goods manufacturer Skellerup Holdings (NZX: SKL ) slipped 2% to 50 cents.  

Amongst listed retailers, Michael Hill International (NZX: MHI ) dropped 1.4% to 72 cents and Warehouse (NZX: WHS ) declined 1.2% to $4.05, while Pumpkin Patch (NZX: PPL ) gained 1% to $2.06 and Hallenstein Glasson (NZX: HLG ) rose 0.9% to $3.28 after the NZ Institute of Economic Research’s Quarterly Survey of Business Opinion showed merchants didn’t have as good a Christmas shopping period as expected, with weak sales up until December 15, and “lacklustre” post-Christmas trading.  

Carpet maker Cavalier (NZX: CAV ) surged 4.5% to $2.80, recovering its losses from the first week of trading this year.

NZ Refining (NZX: NZR ) gained 3% to $3.80 and Freightways (NZX: FRE ) rose 1.2% to $3.44.  

Oil and gas explorer L&M Petroleum (NZX: LME ) announced it has changed its name to L&M Energy and will operate on the NZX and ASX under its new LME ticker from Monday next week. The shares shrank 2.6% to 18.5 cents.

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