MARKET CLOSE: NZ shares rise led by Air NZ on falling fuel costs; SkyCity gains on 1H

Wednesday 11th February 2015

New Zealand shares rose, led by Air New Zealand on falling fuel prices. SkyCity Entertainment Group gained after reporting first-half results. Chatham Rock Phosphate plunged after the Environmental Protection Authority rejected its application to mine the seabed.

The NZX 50 Index rose 5.086 points, or 0.1 percent, to 5789.18. Within the index, 24 stocks rose, 18 fell and eight were unchanged. Turnover was $123 million.

Air New Zealand advanced 4.4 percent to $2.61, as the national carrier benefits from cheaper fuel costs on the back of falling oil prices. Meanwhile, New Zealand Oil and Gas, the country's only oil producer, was the worst performer on the benchmark down 5.3 percent to 62 cents.

"On the back of a bit of weakness overnight in fuel prices Air New Zealand has moved in tandem with what fuel prices have done," said Mark Lister, head of research at Craigs Investment Partners. "Oil prices were down 3 or 4 percent overnight and one would think anything in the oil producing space would be having a negative day."

SkyCity rose 1.5 percent to $3.96. The casino operator said first-half profit fell 11 percent to $54.6 million from a year earlier as income from its Adelaide operation fell, while the performance of its flagship Auckland business improved. Yesterday, Prime Minister John Key wouldn't rule out government funding for its Auckland convention centre, should it overrun its $402 million budget to prevent an "eyesore" being built, but today Minister of Finance Bill English said taxpayer funding would be the government's "least preferred option"

"The Auckland asset returned to growth, to a stronger degree than we expected so that is good, but then again Adelaide was weaker than expected," Lister said. "In the background you've got talk in the press about some comments from the government that they might look to subsidize, for lack of a better word, the convention centre to make sure it’s up to their standard and that's probably having a positive influence as well."

On the New Zealand Alternative Index, CRP tumbled 92 percent to 1.6 cents after the EPA ruled out its proposed mining of phosphate modules on the seabed. Fellow minnow miner Aorere Resources, which owns 8.9 percent of CRP, dived 57 percent to a 0.3 cents.

"It puts their entire business model into question, which is why there is such a big reaction in the share price," Lister said.

Yield stocks, which have been pushed higher by investors search for reliable income, fell as investors looked to crystalise recent gains, Lister said. MightyRiverPower dropped 1.3 percent to $3.37. Spark New Zealand, formerly Telecom Corp, fell 0.6 percent to $3.45. Contact Energy declined 0.7 percent to $7.02. Meridian Energy slipped 0.8 percent to $1.91.

Fletcher Building, the construction and building firm, fell 1.4 percent to $8.35.

Vista Group International rose 1.2 percent to $4.30. The cinema software and analytics company has conditionally agreed to acquire Ticketsoft, a Dallas, Texas-based company whose software is used in more than 200 North American cinemas.

Energy Mad dropped 11 percent to 8 cents. SuperLife, the funds management firm acquired by NZX in December, may end up with a controlling stake in unprofitable lightbulb maker after agreeing to underwrite a rights issue and subscribing for convertible notes.

BusinessDesk.co.nz

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