MARKET CLOSE: NZ shares pare gains on weak Australian jobs; Kathmandu rises

Thursday 8th September 2011

New Zealand shares pared their gains after figures showed Australia unexpectedly shed jobs last month, dimming sentiment that was boosted by second-quarter economic growth figures. Kathmandu Holdings led gainers and Vector fell.

The NZX 50 Index rose 7.102, or 0.2%, to 3308.048 at the close, with earlier gains eroded by the Australian jobs data. Within the index, 15 stocks rose, 18 fell and 17 were unchanged. Turnover was a lower-than-average $88 million.

Australian employers cut workers by 9,700 in August, the second monthly decline in jobs in New Zealand's biggest export market. The jobless rate rose to 5.3% from 5.1%. The New Zealand dollar rose to 78.62 Australian cents from 78.27 cents immediately before the data was released. The figures come a day after the release of second-quarter GDP, which grew 1.2%.

"We're seeing a lot of conflicting data in Australia," said James Lee, head of institutional equities at First NZ Capital. "The GDP is historical while the employment number is more consistent with short-term data."

The New Zealand share market weakened as the kiwi dollar strengthened after the jobs report, he said.

Australia and New Zealand Banking Group fell 1.2% to $25.30 on the NZX. Goodman Fielder, the dual listed food manufacturer, declined 2.5% to 79 cents.

Michael Hill International, the jewellery chain that counts Australia as its biggest market, fell 1.1% to 90 cents.

Kathmandu, the outdoor equipment retailer, rose 3% to $2.06, leading gainers on the benchmark index.

Vector, the Auckland-based power and gas lines company, fell 3.2% to $2.45 after shedding its 7.5 cents-a-share final dividend. Skellerup Holdings, the rubber goods and milking equipment manufacturer, dropped 1.6% to $1.23.

OceanaGold Corp., the operator of the Macraes gold field, rose 4.8% to $3.04 after the NZX said it would be included in the NZX 50 Index from Sept. 19. Inclusion in indexes can make company's more attractive to institutional investors.

APN News &Media, the publisher of the New Zealand Herald, was unchanged at $1.04. It will drop out of the benchmark index on Sept. 19 because it hasn't met liquidity levels needed for continued inclusion.

Fisher & Paykel Healthcare fell 0.5% to $2.14. The Department of Labour's mediation service will try to get the company and its unions to talks after the unions yesterday gave 14 days notice of strike action at the company's Highbrook plant in South Auckland.

New Zealand Oil & Gas was unchanged at 69 cents. The Royal Commission of inquiry into the Pike River Coal mine explosions is continuing, with the current focus on the response to the event and mine safety. NZ Oil & Gas owned 30% of the Pike River project.

(BusinessDesk)

BusinessDesk.co.nz

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