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NZX CLOSE: NZ stocks stumble in global sell-off; FBU, TEL, PPP drop

Friday 5th February 2010

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New Zealand shares fell, driving the NZX 50 Index to its biggest decline this year, as reverberating concerns over sovereign debt in Europe drive down equity markets worldwide.

The NZX 50 fell 43.94, or 1.4%, to 3104.99. Within the index, 37 stocks tumbled, in a move reminiscent of the mood after the Lehman Brothers collapse. Eight shares rose and six were unchanged. Turnover was $74 million.

Japan’s Nikkei 225 Index fell 2.6% in early afternoon trading. South Korea’s Kospi Index fell 3.3%. The Standard & Poor’s 500 fell 3.1% on Wall Street though S&P 500 futures are up 2.8% after U.S. jobless claims fell and concern grew about fiscal deficits in Spain and Portugal.

“The global economy is dragging itself off the floor and there’s going to be some stumbles along the way,” said David Aylward, co-founder of Tribeca Investment Partners in Sydney, which manages A$900 million of Australian equities.The European sovereign debt issues are “troubling.”

Still, the sell off in stocks has made some companies relatively more attractive as there has been some “panic” selling, he said. “It’s the nature of recovery that you take a step forward, a step back – that’s the way this is playing out.”

Pan Pacific Petroleum (PPP), which has been one of the beneficiaries of output from the Tui oilfield, fell 5% to 38 cents, the lowest since April last year.

Pan Pacific, which has abandoned two Timor Sea exploration wells, is looking for more resources.New Zealand Oil & Gas, which owns 15% of Pan Pacific, fell 4.6% to $1.45.

Fletcher Building (NZX: FBU ), the nation’s biggest construction firm, fell 2.3% to $7.52. Telecom Corp (NZX: TEL ), which has been forced to offer $5 million of free credits in compensation for outages on its XT network, fell 4.2% to $2.31.

Australia & New Zealand Banking Group (NZX: ANZ ) fell 3.9% to $26.15. TrustPower (NZX: TPW ) rose 0.3% to $7.34. The utility controlled by Infratil Ltd (NZX: IFT ) is preparing to write off a chunk of $9.5 million spent on a customer service software upgrade project whose costs started to blow out, it said today.

Auckland International Airport (NZX: AIA ), fell 0.5% to $1.95. The airport welcomed more international flights but fewer passengers in 2009, it said in a report today. International aircraft movements rose 4.1% to 41,819 last year, according to the airport’s December monthly traffic update. Total international passengers fell 1.9% to 7.34 million.

Briscoe Group Ltd (NZX: BGR ), the retailer controlled by managing director Rod Duke, jumped 7.9% to $1.36 after saying full-year profit almost doubled, restoring earnings to levels last seen in 2008, after strong Christmas trading fattened its margins. Net income exceeded $20 million in the 12 months ended Jan. 31, from $11.6 million in 2009.

Businesswire.co.nz

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