NZX CLOSE: Shares gain; Farming Systems, Fletcher Building rise

Friday 4th September 2009

New Zealand shares rose for a second day, as NZ Farming Systems Uruguay extended its gains on the back of a new shareholder and better milk prices, and Fletcher Building advanced.

The NZX 50 Index rose 6.75, or 0.2%, to 3098.32. Within the index, 25 stocks rose, 14 fell and 11 were unchanged. Turnover was $94.6 million.

NZ Farming Systems (NZX: NZS ) rose 4.2% to 50 cents, leading the index higher. The shares have advanced 22% since Singapore’s Olam International disclosed on Sept. 1 that it had acquired a 14% from another shareholder at 41 cents apiece.

Fletcher Building (NZX: FBU ), the nation’s biggest construction company, rose 2.2% to $7.86. The National Bank Business Outlook for August, released on Monday, showed a resurgent construction sector and stabilising property market.

PGG Wrightson (NZX: PGW ), the rural services company that’s weighing options to raise capital, rose 2.9% to 70 cents. Pyne Gould Corp (NZX: PGC ). which is in the same South Island ‘stable,’ rose 0.8% to $1.30.

In the week, the NZX 50 fell 0.3%, having slipped from an 11-month peak in mid-August. Reserve Bank Governor Alan Bollard, who announces his review of monetary policy on Sept. 10, said in a Radio New Zealand interview that the economic recovery is fragile and could be derailed by turmoil in world markets.

“We’ve reached the point with the stock market now where under-valuation has been removed,” said Paul Harrison, who helps manage $180 million at BT Funds Management. “Markets want a bit of comfort from the Reserve Bank that they aren’t going to chop the recovery off.”

Investment Research Group (NZX: IRG ), the investment advisory and brokerage firm, soared 91% to 2 cents today, after the company completed its capital raising plans by placing 1.1 million shares at 2.25 cents apiece. The stock has tumbled 86% in the past 12 months.

OceanaGold Corp (NZX: OGC ), the operator of the Macraes gold mine, surged 13% to $1.35 as gold traded near US$1,000 an ounce.

Among decliners, Goodman Property Trust (NZX: GMT ) fell 2.1% to 94 cents, leading the index lower.

Guinness Peat Group (NZX: GPG ) fell 1.2% to 81 cents after announcing that Mike Smithyman, the chief executive of its Coats threadmaker business, has retired, effective Dec. 31. He will be replaced as head of the unprofitable company by Paul Forman, currently CEO of polymer-based materials manufacturer Low & Bonar.

Telecom Corp (NZX: TEL ) fell 0.4% to $2.79. Today is the record date for the phone company’s 6 cents a share fourth-quarter dividend. At today’s price, telecom has a dividend yield of 13%.

Businesswire.co.nz

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