NZ share market closes lower but Warehouse shares surge

By NZPA

Friday 22nd December 2006

The New Zealand share market ended a shortened pre-Christmas session lower despite a surge in the price of The Warehouse on takeover speculation.

The benchmark NZX-50 index eased 9.485 points to 4019.20 as leading shares retreated. The market was open only for a half day today. Rises outnumbered falls by 52 to 43. Turnover was worth $4.23 million.

The Warehouse rose 26c to $7.18 today after supermarket co-operative Foodstuffs said after the market closed yesterday that it was applying for Commerce Commission clearance to take over the company founded by Stephen Tindall.

Foodstuffs, which has teamed up with private equity player Pacific Equity Partners according to local media reports, said it has not yet made a decision to formally bid.

"It's difficult to know what is going to happen," said Grant Williamson, partner at Hamilton Hindin Greene. "There is a real premium being built into the share price because of the corporate activity that is likely to follow."

He said offshore markets were weaker overnight and that caused some profit taking in a session that did not overlap much with foreign markets.

Telecom was down 8c at $4.81 on profit-taking from a recent run higher. Fletcher Building rose 10c to $11.00 after initially opening weaker.

Contact was down 10c at $8.18, retreating from its recent run higher.

Fisher & Paykel Healthcare was unchanged at $4.25 and the appliance stock was also unchanged at $3.95.

Cavalier was up 5c at $3.60. Freightways was down 4c at $4.44 and Mainfreight down 10c at $7.95.

Lion Nathan rose 3c at $9.15. Guinness Peat Group eased 1c at $2.43 and Infratil eased 3c to $5.45.

Port of Tauranga rose 7c to $5.82, Tourism Holdings eased 1c at $1.94. SkyCity eased 2c to $5.05. Nuplex eased 14c at $7.35. Tower eased 1c to $2.25.

Pumpkin Patch rose 4c to $4.45 and Ryman was up 12c at $10.27. SkyTV was up 10c at $6.35.

US stocks dropped on Thursday after reports showing a contraction in regional business activity and a downward revision in GDP data added to worries about slower economic growth.

The Dow Jones industrial average was down 31.41 points, or 0.25%, at 12,432.46. The Standard & Poor's 500 Index was down 5.20 points, or 0.37%, at 1418.33.

The Nasdaq Composite Index was down 10.81 points, or 0.45%, at 2416.80.

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