MARKET CLOSE: Sharemarket flat as currency soars

Friday 27th May 2011

The New Zealand sharemarket was flat today as investors contemplated a range of earnings reports, a rating cut for banks, a rating warning for Telecom and a soaring New Zealand dollar.

The benchmark NZX-50 index closed up 0.373 points at 3527.961. Regional markets around Asia were mostly higher today.

Fisher & Paykel Appliances (NZX: FPA ) rose 10% to 61 after the company reported full-year net profit of $33.5 million, following a loss of $83.3 million a year earlier.

Mainfreight (NZX: MFT ) shares rose a stunning 47c to a record $9.91. Yesterday they had gained 18c after the logistics company reported a hike in full-year net profit before non-recurring expenses to a record $47.2 million.

Tower (NZX: TWR ) shares fell 3c to $1.76 after the insurer and fund manager reported half-year net profit down 54% to $12.8 million, hit by the Christchurch earthquakes and global investment market changes. The company called the result "pleasing".

Telecom (NZX: TEL ), which has been experiencing profit-taking from a run higher, eased 6c to $2.37 after Standard & Poor's reaffirmed its rating but said it could be cut by one or two notches if shareholders approve the separation of its network business from the rest of the company.

Moody's today cut the ratings of all of the four major New Zealand banks by a notch to Aa3, following a review of bank ratings and a downgrade of the Australian parents on May 18. Westpac (NZX: WBC ) rose 20c to $29.05 today and ANZ (NZX: ANZ ) eased 5c to $28.75.

Contact Energy (NZX: CEN ) eased 2c to $5.92 on a day it got consents for a wind farm in Waikato.

There were also earnings reports from Pharmacybrands, Sealegs and Pacific Edge Ltd.

Fletcher Building (NZX: FBU ) added 3c to $8.84, Abano Healthcare (NZX: ABA ) lifted 3c to $4.70 and Pumpkin Patch (NZX: PPL ) rose 1c to $1.18.

In the US, stocks rose for a second day in a choppy session, with technology and consumer discretionary stocks leading the way after upbeat earnings.

The market's ability to sustain an advance ebbed and flowed with developments in the foreign-exchange market and fears over Europe's sovereign debt crisis.

The Dow Jones industrial average edged up 0.1% to 12,402.76, the Standard & Poor's 500 Index gained 0.4% to 1325.69, and the Nasdaq Composite Index rose 0.8% to 2782.92.

NZPA

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