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MARKET CLOSE: NZ stocks rise on more easing speculation

Wednesday 13th October 2010

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New Zealand stocks rose for the second time in three sessions, pacing Asia Pacific markets higher as the prospect of a second round of quantitative easing in the US buoyed investor appetite.

PGG Wrightson, Steel & Tube and Rakon paced gainers on the day.

The NZX 50 Index rose 0.98 points, or 0.1%, to 3,231.81. Within the index, 18 stocks rose, 15 fell and 17 were unchanged. Turnover was $84.3 million.

In the US overnight the minutes from the last Federal Open Market Committee meeting were released, suggesting the central bank will embark on a second round of asset purchases when it meets next month.

“US market picked up the Fed’s hints that it is looking strong on another round of quantitative easing,” said Karl Williscroft, a trader at Direct Broking. “That’s fed into us and regional markets on the day.”

Wrightson (NZX: PGW ) rose 3.6% to 58 cents. Today is the first day of the extended government guarantee, and Wrightson Finance was among the finance companies that chose to retain Crown backing.

Steel & Tube (NZX: STH ) rose 2.5% to $2.49, Rakon (NZX: RAK ) rose 1.7% to $1.23, and Fletcher (NZX: FBU ) rose 1.2% to $8.19.

Pike River Coal (NZX: PRC ) rose 0.8% to $1.20, easing back from the historic highs yesterday as the coal miner announced it had reached one of its hydro-coal milestones on schedule.

“It great to see them get closer to actual production, after all their job is getting coal out of the ground,” Williscroft said.

NZ Oil & Gas (NZX: NZO ) which holds a 25% stake in Pike, rose 0.8% to $1.34.

Telecom (NZX: TEL ) was unchanged at $2.02. Communications Minister Steven Joyce announced today that the government will waive requirements on Telecom to migrate its existing broadband customers to the new wholesale broadband service and made other concessions over requirements Telecom had called onerous.

"I believe the changes will serve the best interests of customers and also allow Telecom to develop services and systems that are consistent with the changes being brought about by the ultra-fast broadband initiative," Joyce said.

Vital Healthcare Property Trust (NZX: VTH ) fell 2.2% to $1.30, leading decliners on the NZX 50. Argosy Property Trust, the property investor formerly known as ING Property, fell 1.3% to 77 cents, AMP NZ Office Trust (NZX: APT ) fell 1.2% to 80 cents, and Goodman Property Trust (NZX: GPT ) fell 1% to 98 cents.

“Given the good run property stocks have had this month, it’s not surprising to see investors book some profits,” Williscroft said.

NZ Refining (NZX: NZR ) fell 1.6% to $3.70, Ebos Group (NZX: EBO ), the medical supplies company, fell 1.4% to $6.90, Sky City (NZX: SKC ) fell 1.4% to $2.88.

The Food Price Index rose 0.7% in September after a 0.1% decline a month earlier, according to Statistics New Zealand data. That was led by 2.6% increase in fruit and vegetable prices, with wild weather conditions pushing up broccoli prices by almost 50% and lettuce prices by 14%.

 

Businesswire.co.nz



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