MARKET CLOSE: NZ shares rise as Asia picks up alongside oil prices; Sky TV, Fisher & Paykel, Trade Me gain

Friday 22nd January 2016

New Zealand shares rose with markets across Asia picking up after a rebound in oil prices. Sky Network Television, Fisher & Paykel Healthcare and Trade Me Group gained.

The S&P/NZX 50 index advanced 40.72 points, or 0.7 percent, to 6121.62. Within the index, 21 stocks rose, 19 fell and 10 were unchanged. Turnover was $88 million.

Sky TV led the index, rising 4.7 percent to a three-week high $4.45. The stock has fallen 26 percent in the past 12 months as it battles with the increasing popularity of streaming sites such as Netflix. Earlier this week, Netflix announced it would crack down on customers streaming shows that aren't officially available in their country.

"There's potentially some investors who are looking for a bit of value there," said Robert Garden, an investment adviser at Craigs Investment Partners. "It's been a pretty tricky stock in recent times, there are ongoing changes in the sector it operates in, and a bit of doubt as to the role it's going to play in a few years' time."

Global stock markets traded higher last night and today after oil prices recovered during US trading overnight, though are still near 12-year lows. Traders' confidence was also helped by the prospect of more monetary easing after comments from European Central Bank chief Mario Draghi that it was being considered.

"The jump in oil prices added some confidence, and the comment from Europe overnight helped sentiment today," Garden said. "The talk from the European Central Bank was that they're ready and able to provide some more stimulus, so that added a bit of support."

Markets rose in Asia this afternoon, with the S&P/ASX 200 index up 1 percent at 5:30pm New Zealand time. Hong Kong's Hang Seng rose 1.4 percent, and Japan's Nikkei 225 index advanced 4.2 percent.

Fisher & Paykel Healthcare rose 3.6 percent to $8.60, another three-week high. The company's competitor, ASX-listed medical equipment company ResMed, saw gains today after posting a 7 percent lift in revenue in the December quarter, and Garden said Fisher and Paykel was "piggybacking a bit" on that result, with the market for medical equipment strong.

Trade Me Group rose 3.5 percent to $4.17, Spark New Zealand increased 3.3 percent to $3.34, and Genesis Energy gained 2.8 percent to $1.87.

"Low oil prices are still filtering through," Garden said. "Some investors are looking at companies which they think may do well in the current environment," such as Air New Zealand, which today rose 1.4 percent to $3.16.

Steel & Tube Holdings gained 1.4 percent to $2.25 and Metlifecare advanced 1.2 percent to $4.40.

Ebos Group was the worst performer on the index today, dropping 2.8 percent to $13.40. Coats Group fell 2.1 percent to 46 cents, and Orion Health Group slid 1.6 percent to $3.

Summerset Group fell 2 percent to $4. The retirement village developer and operator's Auckland-centred growth plan has seen its stock downgraded to a 'neutral' rating from 'outperform' by First NZ Capital analysts, who say moderation in house price growth could limit the company's ability to outperform expectations. Earlier this month, Summerset said it had lifted occupation rights sales 26 percent in 2015, and affirmed earnings guidance for underlying profit of between $36 million and $39 million in calendar 2015.

BusinessDesk.co.nz

Comments from our readers

No comments yet