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Stocks to watch: Strong US market helps NZ shares rise

Thursday 3rd June 2010

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Energy stocks are likely to be a theme today following big gains on the United States which were led by energy stocks. Also in the news are plans for NZ energy companies to use an ASX platform.

Themes of the day: Stocks on Wall Street rebounded from the previous day’s slump, with the Standard & Poor’s 500 Index gaining 2.6% after data showed home sales rose more than expected and Bank of America and Wells Fargo & Co. indicated credit markets were improving. The kiwi dollar climbed about half a US cent to 68 US cents.

Affco Holdings (AFF): The North Island meat processor said it has completed its share purchase plan, raising $83 million for investment. The shares last traded on May 31 at 37 cents.

AMP NZ Office Trust (APT): The commercial property investor yesterday confirmed settlement of five retail units in Wellington’s Chews Lane precinct for $11.7 million before disposal costs, representing a weighted average yield being 7.15%. The trust will use the funds to repay bank debt, helping push gearing down to 23% by the end of this month. The shares were unchanged yesterday at 70 cents.

Freightways (FRE): The courier business was raised to ‘outperform’ from ‘market perform’ by ASB Securities analyst Florian Burch, according to ShareChat. The company has strong brands and good customer loyalty, diversified customer base and recurring revenue streams, Burch said. It also has growth potential in document and data storage. The shares fell 1.7% to $2.95 yesterday.

Guinness Peat Group (GPG): The investment company chaired by Ron Brierley said it has received notification from Brisbane-based Suncorp–Metway that it has lifted its stake to 52.8 million shares, or 3.19% of the stock. The shares have tumbled about 22% in the past month, amid disappointment that it failed to announce a capital return, as it had hinted it would. The complexities of its tax obligations in various countries were among issues slowing the process, Brierley said at the time of the AGM. The stock dropped 5.6% to 68 cents yesterday.

NZX (NZX): The exchange operator's plans to build a new future based on derivatives trading took a serious knock this morning with the announcement that the country's five main electricity generators will use the ASX to operate the new electricity forward market mandated by Energy Minister Gerry Brownlee's electricity reforms. The shares fell 5 cents to $1.61.

Port of Tauranga (POT): A hearing panel is to recommend to the Conservation Minister that the port be granted permission to deepen and widen harbour shipping channels. The work is part of POT’s preparation for the anticipated arrival of larger vessels at New Zealand’s ports. The shares fell 10 cents to $6.64 yesterday.

Pyne Gould (PGC): The finance company’s stock rose 2.2% to 46 cents yesterday, the second daily advance of that size after the finance company said it is in talks to merge its Marac finance unit with Canterbury Building Society and Southern Cross Building Society to create a bank with $2.2 billion of assets.

Xero (XRO): The online accounting software company today announced a regional agreement with ANZ to distribute its online accounting services to the bank’s customers. Xero said it will offer the bank’s 450,000 small business customers in Australia an online, integrated banking and accounting solution. The stock was unchanged at $1.45 yesterday.

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