MARKET CLOSE: NZ stocks rise on offshore sentiment

Monday 30th August 2010

New Zealand stocks rose for the third time in four sessions, following positive sentiment from offshore markets on the back of mildly more positive US GDP data.

Australian listed stocks AMP, Goodman Fielder, and Westpac lead gains.

The NZX 50 rose 29.4 points, or 0.9%, to 3036.8. Within the index 24 stocks rose, 9 fell and 17 were unchanged. Turnover was $92.2 million.

Markets around the Asia Pacific rose following a rally in U.S stocks on Friday after an announcement from the Commerce Department said the world’s largest economy grew at a 1.6% annual rate in the second quarter. While down from the department’s initial estimate of 2.4%, the drop-off wasn’t as bad as some economists had predicted.

Japan’s Nikkei was last trading 1.5% up at 9124.3, Hong Kong’s Hang Seng was 0.7% up at 20744.4, and Australia’s ASX was last 4440.1, up 1.6%.

“The US clearly closed very strongly on Friday, and it is just natural that we would flow on from that stream,” said Rickey Ward, domestic equities manager at Tyndall Investment Management. “The market just seems to have a very short-term attention span right now.”

Goodman Fielder (NZX: GFF ) rose 3.7% on the NZX to $1.67, pacing gains on the NZX 50. On the ASX, the stock was last trading 1.1% up at A$1.44.

Westpac (NZX: WBC ) rose 3.7% to $28.00, while AMP (NZX: AMP ) rose 3.2% to $6.40.

Pyne Gould (NZX: PGC ) rose 2.5% to 41 cents. The finance company said last week that it is making progress in talks with partners Canterbury Building Society and Southern Cross Building Society, with a goal to merge the lenders next year and form the country's only locally-owned and listed bank.

Fisher & Paykel Healthcare (NZX: FPH ) rose 3.2% to $2.90 after the company said it expects no earnings growth this year, reflecting a strong kiwi dollar. FPH chief executive, Mike Daniell, told shareholders at the NZX star’s annual general meeting on Friday that earnings will gain 10% “in constant currency terms.” Its shares last traded at $2.81.

New Zealand's merchandise trade deficit was bigger than expected last month as exports fell, stoking concern the key drivers of dairy products and forest products may be coming off the boil.

The trade deficit was $186 million in July, from a revised surplus of $214 million in June, according to Statistics New Zealand. Exports of $3.57 billion lagged behind the forecast $3.69 billion in a Reuters survey, while exports of $3.57 billion exceeded the forecast $3.7 billion.

The monthly value of exports was still a record for a July month, the government statistician said.

Pacing decliners on the NZX 50, Telstra (NZX: TLS ) fell 4.1% to $3.50.

ING Property Trust (NZX: ING ) fell 1.5% to 68 cents, Kathmandu (NZX: KMD ) fell 1.3 to 1.58, and Goodman Property Trust (NZX: GPT ) fell 1.1% to 93 cents.

Sky City (NZX: SKC ) fell 0.4% to $2.90. The Auckland-based hotel and casino operator is looking to expand its Adelaide business as part of the state government's riverfront development plans. The investment would see Adelaide Casino expand towards the river front, with enlarged gaming facilities, bars, restaurants and car parks, the Auckland-based company said.

Redgroup Retail, the owner of the Whitcoulls and Borders book stores, gained a waiver for breaches to its banking covenants and said chairman Rod Walker will step down, and its owner, Pacific Equity Partners, is looking at a range of options to bolster its balance sheet.

Businesswire.co.nz

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