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Stocks to watch: NZ Oil & Gas, Ecoya, PGW, ANZ, WBC

Thursday 6th May 2010

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New Zealand Oil & Gas shares drop on the back of falling crude prices and Ecoya shares climb above its IPO price of $1. PGG Wrightson shares slide as director, Alan McConnon steps down from the board.


New Zealand Oil & Gas (NZX: NZO ): New York crude sank below US$80 a barrel after US Energy Department figures showed rising stockpiles and on concern the Greek debt crisis will ripple across Europe and restrain its economic recovery. The shares fell 3.2% to $1.51 yesterday.

Ecoya  (NZX: ECO ): The scented candle company, the latest marketing venture from the team that promoted 42 Below vodka, climbed 1 cents above its IPO price of $1 yesterday, the first time it has been ‘in the money' since its debut on Monday. The company raised $10.1 million in the IPO to drive sales into North America and Asia. 

PGG Wrightson (NZX: PGW ): Alan McConnon, who sits on the board of the McConnon family's Aorangi Laboratories stepped down from the Wrightson board yesterday. Aorangi owned the biggest stake in Rural Portfolio Investments, the investment vehicle of Baird McConnon and Craig Norgate which was placed in receivership this week, leaving a question mark over the status of its 46.8 million Wrightson shares. The stock fell 3.6% to 53 cents yesterday.

Australia & New Zealand Banking Group (NZX: ANZ ): The lender is rated ‘add’ by David Ellis, an analyst at Aegis Equities Research, according to the ShareChat website. ANZ posted a 22% gain in first-half earnings and Ellis said he expects “further solid growth in earnings and dividends over the next few years at least." The shares fell 4.4% to $30.08 yesterday.

Westpac Banking Corporation (NZX: WBC ): Australia’s No. 2 lender dropped 4.6% to $33.40 on the NZX yesterday amid concern about weaker-than-expected margins and a more challenging second half after profit in the first six months of the year jumped 32%. Westpac “is a company with a fantastic record of over-achieving” though it is fair value currently and investors are concerned it may face an “earnings growth challenge,” said Chris Weston, institutional dealer at IG Markets in Melbourne. Citigroup cut Westpac to ‘hold’ from ‘buy.’


Economic themes of the day: Commodity prices dropped on concern the Greek debt crisis will undermine economic growth in Europe as the contagion spreads to other economies.

The Reuters/Jefferies CRB Index of 19 raw materials sank 1.2%, led by declines in oil and copper. Greek contagion fears also helped drive down stocks on Wall Street, with the Standard & Poor's 500 Index sliding to a six-week low.

Reserve Bank Governor Alan Bollard is scheduled to give a speech this morning, expanding on his most recent OCR review and discussing the outlook for the New Zealand economy.

While the speech is closed to the public, Bollard was scheduled to release a statement from it at 10 am Employment data out today is expected to show the jobless rate held at 7.3% and the participation rate was unchanged at 68.1%.

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