MARKET CLOSE: NZ shares fall, led by offshore markets; Nuplex, Sky TV, Orion Health down, Air NZ up

Thursday 21st January 2016

New Zealand shares fell following oil-driven weakness in US and European markets, with Nuplex Industries, Sky Network Television and Orion Health Group dropping while Air New Zealand rose to a thirteen and a half year high.

The S&P/NZX 50 Index dropped 32.8 points, or 0.5 percent, to 6080.9. Within the index, 34 stocks were down, 10 rose and six were unchanged. Turnover was $100 million.

Leading the index lower was Nuplex, which fell 3.8 percent to $4.32. Sky Network Television, which has been struggling with the advent of online competitors like Netflix, dropped 3.4 percent to $4.25; Orion Health Group dipped 2.6 percent to $3.05.

The NZX 50 had fallen as much as 1 percent, before recovering later in the day as Asian stocks were mostly positive in afternoon trading. Markets on Wall Street and in Europe had tumbled overnight as oil prices continued to fall before recovering late in the session with a rebound in the oil price.

At close of the local market, Australia's S&P/ASX 200 was up 0.7 percent, Hong Kong's Hang Seng rose 0.5 percent, and China's CSI 300 composite had risen 0.7 percent.

"New Zealand has really just followed the lead from offshore markets today, " said Nick Dravitzki, equity analyst at Devon Funds Management. "Given the level of anxiety that's been around about stocks, and how sharply Europe was down last night and the US for most of the day, in some ways it's a bit of a relief that we're only down a little bit today. There was a decent rally into Wall Street's close, and that has meant today's been a lot less bad than it could have been."

Today's decline was spread across industries, with Spark New Zealand falling 2.3 percent to $3.235, Australia & New Zealand Banking Group shed 1.8 percent to $25.15, and Trade Me Group slipped 1.7 percent to $4.03.

Kathmandu Holdings fell 1.3 percent to $1.54, Metro Performance Glass was down 1.2 percent to $1.60, and Diligent dropped 1.2 percent to $5.95.

"Our market's still holding up better than a lot of those offshore, because a lot of the selling and the weakness was centred on anything that's in the business of oil," said Mark Lister, head of private wealth research at Craigs Investment Partners. "It was the material companies, the energy companies that got pounded, but we don't have any of those so our market's holding up reasonably well."

Air New Zealand, a beneficiary of low oil prices, was the biggest gainer on the index today. It rose 1.5 percent to $3.115, its highest level since July 2002.

Skellerup Holdings rose 1.4 percent to $1.46, Meridian Energy gained 1.1 percent to $2.35, and Auckland International Airport increased 0.6 percent to $5.55. Port of Tauranga rose 0.3 percent to $18.10.

"You're definitely seeing a bit of relative outperformance from stocks where the earnings are reasonably predictable - your staple defensive businesses like Port of Tauranga, Auckland Airport, and power companies," Dravitzki said.

Genesis Energy rose 0.6 percent to $1.82, and Vital Healthcare Property Trust increased 0.5 percent to $1.88.

BusinessDesk.co.nz

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