MARKET CLOSE: NZ shares rise, led by Comvita, Tegel, Port of Tauranga

Wednesday 25th January 2017

New Zealand shares rose, with Comvita continuing its bounce from Monday's plunge and Tegel Group Holdings gaining.

The S&P/NZX 50 Index gained 26.76 points, or 0.4 percent, to 7,090.92. Within the index, 30 stocks rose, 12 fell and eight were unchanged. Turnover was $145.2 million.

"Following on from offshore leads, it's a sea of green everywhere," said David Price, broker at Forsyth Barr. "It's picking up but it's still relatively quiet, this is kind of the first week back. The market has gone into cruise mode coming up to reporting season, it's kind of late to be getting any confessions now."

At 5:05pm New Zealand time, Australia's ASX 200 was up 0.4 percent, Japan's Nikkei 400 rose 0.8 percent and Hong Kong's Hang Seng advanced 0.2 percent.

Comvita led the index, rising 4.4 percent to $7.30. The manuka honey products maker's shares dropped 17 percent on Monday after it warned annual earnings will tumble by about two-thirds as the nation's unseasonably wet and windy weather saps the honey harvest and slow sales via China's informal trading channels, but bounced 7.5 percent yesterday.

"I don't think the downgrade was a surprise, they had been talking that way - things had been a bit slow for them, and the result would probably be a little softer than they originally thought - they talked about that back in October," Price said. "The reaction was reasonably extreme, so it's just correcting a bit of that aggressive selling we saw on Monday."

Tegel Group Holdings, yesterday's worst performer, rose 3.1 percent to $1.34. Price said he didn't read much into the rise, which is on low volumes.

Port of Tauranga gained 2.3 percent to $4.09, New Zealand Refining Co advanced 2.2 percent to $2.75 and Argosy Property rose 1.9 percent to $1.05.

Air New Zealand advanced 0.5 percent to $2.20. Passenger revenue in the first six months of the company's financial year has fallen sharply, even when the impact of foreign exchange fluctuations are eliminated. Short haul passenger revenue through its preferred metric fell 6.3 percent in the six months to December, while long-haul passenger revenue slumped 14.3 percent.

Genesis Energy gained 0.5 percent to $2.16. The country's largest energy company by customer numbers says electricity retail connections fell by 1.2 percent to 514,155 between the end of September and the end of December 2016.

Units in the Fonterra Shareholders' Fund gained 0.2 percent to $6.27. Fonterra Cooperative Group has sought to reassure shareholders after its Chinese partner Beingmate Baby and Child Food Co slashed its full-year guidance. Fonterra bought an 18.8 percent stake in Beingmate in 2015 as it sought to ensure greater access to the Chinese market, and says the long-term outlook in China is still strong.

SkyCity Entertainment Group was the worst performer, down 0.8 percent to $3.87, and Ebos Group declined 0.8 percent to $16.80.

Outside the benchmark index, Turners was unchanged at $3.80. The country's largest seller of vehicles will sell stakes in its loan book in a deal worth an initial $150 million. The securitisation programme is to start in February, with the first sales due to occur in March.

BusinessDesk.co.nz

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