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MARKET CLOSE: NZ shares gain 1.8% in April in subdued end to month

Tuesday 30th April 2019

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New Zealand shares edged higher in the final day of April trading, capping a 1.8 percent gain for the month that saw the benchmark index cross the 10,000 level for the first time. 

The S&P/NZX 50 Index increased 1.06 points, or 0.01 percent, to 10,013.83. Within the index, 23 stocks rose, 22 fell, and five were unchanged. Turnover was $195.2 million, of which Trade Me Group accounted for $42.4 million. 

Trading was subdued with a lot of investors in Sydney for the Macquarie Australia Conference, where dozens of company executives provide updates on their businesses.

April was another month of solid gains for the benchmark index, taking its year-to-date increase to 13.7 percent, ahead of the reporting period for companies with March and September balance dates. 

Three of the four major Australian banks will report first-half earnings during the coming week, with Australia and New Zealand Banking Group first up tomorrow. ANZ's local subsidiary is New Zealand's biggest bank, and is most at risk from the Reserve Bank's proposals to hike lenders' capital requirements. The dual-listed shares decreased 0.2 percent to $28.74 today. 

Z Energy, which reports on Thursday, was up 0.5 percent at $6.33. 

"I don't think there'll be a massive outperformance from the companies that are reporting - perhaps the odd surprise," said Grant Davies, an investment advisor at Hamilton Hindin Greene. 

"February reporting was solid if unspectacular and that's probably what we'd expect from this period."

Ebos Group shares were halted at $21.42 after the pharmaceuticals and animal care products maker announced an underwritten $150 million placement to institutional investors. 

Davies said the company has a track record of making acquisitions and the extra headroom from the capital raising will give it more headroom to pursue any purchases.

However, he said retail investors might feel aggrieved that they were excluded and questioned whether the underwrite was necessary given the current market conditions. About $1 billion of bonds are maturing in the coming month and will be looking for new investment options. Proceeds from the $2.56 billion Trade Me takeover will also be looking for a home, Davies said.

Trade Me slipped 0.2 percent to $6.43, with 6.6 million shares traded, the most for the day. Its shares will be suspended on May 2 before it formally delists next week after the successful $6.45 per share takeover. 

Spark New Zealand rose 0.8 percent to $3.67 on a volume of 4.6 million shares, while Kiwi Property Group was up 0.3 percent at $1.54 on a volume of 3.1 million shares. 

Fletcher Building fell 2.1 percent to $5.16 on a volume of 2.4 million shares, about twice its 90-day average. Of other companies trading on volumes of more than a million shares, Meridian Energy fell 0.5 percent to $4.06, Auckland International Airport decreased 0.1 percent to $7.97, Fisher & Paykel Healthcare increased 0.1 percent to $15.81, and A2 Milk Co was unchanged at $16.77. 

Investore Property led the market higher, up 2.5 percent at $1.64 on a volume of 93,000 shares, less than its 126,000 three monthly average. Its manager, Stride Property, rose 0.5 percent to $2.03. 

Metlifecare rose 2.3 percent to $4.95 and Kathmandu Holdings was up 2.2 percent at $2.35. 

Summerset Group fell 0.9 percent to $5.61 on a volume of 469,000 shares, more than its 90-day average of 315,000. The retirement village operator and developer told shareholders it has scaled back its development programme for this year in the face of slowing housing and construction markets. 

Tourism Holdings fell 3.4 percent to $4.04 on a volume of 172,000 shares, more than its usual 119,000, while Air New Zealand declined 2.4 percent to $2.685 on a volume of 820,000, down on its 1.1 million average. 

Outside the benchmark index, Asset Plus was unchanged at 60 cents after announcing a $58 million acquisition of a building in downtown Auckland from Auckland Council, pending shareholder approval. Manager Augusta Capital was also unchanged at $1.12. None of Auckland Council's five listed bonds traded today. 

TeamTalk rose 1.2 percent to 87 cents after announcing plans to rebrand itself and its CityLink fibre business as Vital. 

NZME rose 3.8 percent to 55 cents on a volume of 415,00 shares, almost four times its three-month average. The media company today launched a subscription for premium content on ts NZ Herald website, which will need marketing investment over the coming year. NZME expects it to generate positive earnings in its second year. 

(BusinessDesk)

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