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MARKET CLOSE: NZ shares edge up in quiet trading; property stocks rise while gentailers fall

Monday 30th September 2019

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(Sept. 27, 5:57 PM) New Zealand shares edged higher in relatively quiet trading, with property stocks including Kiwi Property Group and Stride Property among the day's gainers. Electricity generators were largely weaker. 

The S&P/NZX50 50 Index increased 13.73 points, or 0.1 percent, to 10,836.5. Within the index, 28 stocks rose, 20 fell, and two were unchanged. Turnover was $87.8 million, with just two stocks trading on volumes of more than a million shares. 

International leads were mixed as investors try to gauge the impact of volatile geopolitical threats, such as the potential impeachment of US President Donald Trump through to the protracted trade war between the US and China. 

Investors have been drawn to stocks offering reliable dividends this year as the low interest rate environment has increased the attraction of defensive equities. That demand has underpinned the 23 percent gain on the benchmark index so far this year, which has been led by Meridian Energy, up more than 55 percent. 

James Lindsay, a portfolio manager at Nikko Asset Management, said while the benchmark index was reasonably flat today, the gain so far this year was strong and added to the local market's run over the past decade. 

"If you look back since the GFC, the return from the New Zealand market have been quite impressive," he said. 

Meridian fell 3.9 percent, or 21 cents, to $5.18, after shedding rights to about 13.2 cents per share of dividends. That was the day's biggest decline, albeit on a volume of 597,000 shares, less than half its 90-day average of 1.4 million. 

Lindsay said the electricity stocks were generally weaker on the day, reversing yesterday's strength. Genesis Energy fell 1.3 percent to $3.40 and Contact Energy was down 0.7 percent at $8.49. 

Mercury NZ fell 0.8 percent to $4.97 on a volume of 2.3 million shares, more than three times its average 698,000. The power company confirmed earnings guidance at today's annual meeting, which marked the departure of long-serving chair Joan Withers. 

Property stocks were generally stronger, with Kiwi Property Group up 1.5 percent at $1.655, Precinct Properties New Zealand rising 1.4 percent to $1.85, Stride Property advancing 1.3 percent to $2.31, and Property For Industry up 1.1 percent at $2.38. Goodman Property fell 0.9 percent to $1.13. 

Pushpay Holdings, which generates most of its revenue in the US, led the market higher, up 3.8 percent at $3.32 on a volume of 64,000 shares, about a tenth of its 650,000 average. 

Ryman Healthcare was up 2.1 percent at $13.05 and SkyCity Entertainment Group rose 2 percent to $4.02. 

Kathmandu Holdings fell 1.3 percent, or 4 cents, to $3.03, after giving up rights to a 12-cent dividend. The retailer reported a strong result earlier this month. 

Outside the benchmark index, Hallenstein Glasson Holdings was up 0.9 percent at $5.95 after beating earnings guidance and saying sales growth had accelerated in the first two months of the latest year. Warehouse Group rose 0.4 percent to $2.45, having reported a recovery in earnings earlier this week. 

"In a soft period for the New Zealand economy and for the context - in theory - of a tough online world to be battling against, all those retailers have come out with surprisingly okay results," he said. 

IkeGPS fell 4.7 percent to 61 cents, after saying it will raise up to $6.5 million to buy a US engineering software developer, which will immediately add to earnings. Ike is selling the shares at 60 cents each. 

New Zealand Post's 2039 notes paying annual interest of 6.35 percent were the most traded debt security on a volume of 646,000. They closed at a yield of 2.9 percent, down 43 basis points, after the state-owned enterprise reported a wider annual loss due to impairment charges and other one-off costs. However, its increasingly important parcels business turned a small profit. 


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