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MARKET CLOSE: NZ stocks fall, led by Fletcher; SkyCity, Spark gain

Wednesday 12th April 2017

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New Zealand shares fell as geopolitical tensions continued to sideline investors. Fletcher Building declined while SkyCity Entertainment Group and Spark New Zealand rose.

 

 

The S&P/NZX 50 index fell 2.8 points, or 0.04 percent, to 7,251.55. Within the index, 17 stocks gained, 20 fell and 13 were unchanged. Turnover was  $145 million.

 

 

The local bourse tracked a similar tepid move across many of Asian stock markets as defensive plays like the Japanese yen and gold gained ground against a backdrop of rising US tensions with North Korea and with Russia. According to Reuters, Japan's navy is planning a joint show of force with the U.S. Navy's USS Carl Vinson aircraft carrier strike group as it steams toward the Korean peninsula aimed at deterring secretive North Korean regime from further missile tests. Meanwhile, U.S. Secretary of State Rex Tillerson was in Moscow for talks on the standoff over Syria.

 

 

Fletcher shed 2.6 percent to $7.97.  

 

 

"The main drag on the index today has been Fletcher Building," said Hamilton Hindin Greene broker Grant Williamson. There were some signs of foreign selling in the stock, which has been under pressure since the company cut its full-year earnings guidance in March by about $110 million because of complexity and delays with a major development that showed up during a review of its construction division.

 

 

On the plus side of the ledger SkyCity continues to improve, said Williamson. The stock added 1.4 percent to $4.52, continuing a move higher that started several weeks ago, he said. "They got into an oversold position now it just seems to be on the recovery road," he said.

 

 

Williamson said investors have showed renewed interest after New Zealand's only listed casino company posted an 18 percent lift in first-half profit as improved trading at its key Auckland casino offset a weaker performance from its Australian and high-roller businesses.

 

 

Spark rose 2.9 percent to $3.60 as investors were cheered by news that TeamTalk shareholders overwhelmingly backed a deal to sell a controlling stake in rural broadband unit Farmside to Vodafone New Zealand, effectively rejecting a takeover offer from Spark. TeamTalk shares rose 2.5 percent to 82 cents.

 

 

‚Äč"It was creating a bit of uncertainty for Spark investors and the stock dropped a little when it was announced and now it is completely off the table investors have decided to get back into it," said Williamson. 

 

 

Chorus shed 0.5 percent to $4.28 after news it  lost ground in the battle for broadband connections in the first three months of the year as end-users switched to fibre provided by local fibre companies and as Spark New Zealand stepped up its wireless network campaign. The Wellington-based company lost 15,000 broadband connections in the March quarter, leaving it with 1.2 million as at March 31 compared to 1.23 million a year earlier. "The market was obviously a tad disappointed with that," he said. 

 

 

PushPay Holdings gained 0.5 percent to $1.90 after the mobile payments app developer announced record revenue growth in the first quarter and affirmed its full-year guidance. "They are continuing to grow their revenue and the market quite liked that," he said.

 

 

(BusinessDesk)

 



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