Sharemarket surges 2% on Auckland Airport

By NZPA

Monday 18th June 2007

The New Zealand sharemarket surged more than 2% today after news that one of its larger stocks could be in play.

Auckland Airport shares rose as much as 48c to $3.30 after the company said Canada Pension Plan Investment Board (CPPIB) had been approaching its shareholders in an attempt to buy shares prior to a possible bid.

The airport company said it understood CPPIB had been unsuccessful but it advised shareholders not to sell their shares.

Auckland Airport shares closed up 38c, or 13%, at $3.20.

"I think it's likely to stay around these levels. Frankly, if there is any approach made to take the company over, $3.10 is going to be well short and I think anyone looking to do it would have to be looking around the $3.50 mark to take that company over," Hamilton Hindin Greene partner Grant Williamson said.

The benchmark NZSX-50 index closed up 90.72 points at 4303.18, on turnover valued at $101.5 million. Rises outnumbered falls 77 to 42.

"That's a very big day and it's rubbed off on a lot of the other blue chips stocks on the market as well," Williamson said.

"I think a lot of investors are starting to say there's a large amount of money offshore looking for good solid investment and New Zealand is coming under the microscope somewhat."

Fletcher Building rose 15c to $12.86, Contact Energy was up 23c at $9.05, Fisher & Paykel Appliances was up 6c at $3.75, F&P Healthcare rose 3c to $3.54, and Sky City -- the perennial subject of takeover speculation -- was up 24c at $5.14.

As well as an attempted raid on one of its stocks, the market also absorbed unconfirmed reports that the Reserve Bank of New Zealand was intervening in the currency market to push the New Zealand dollar down.

The news vacuum in the lead-up to the June 30 balance date that brokers talked about last week was gone.

Air NZ rose 3c to $3.10, on top of a 5c rise on Friday.

Market leader Telecom also benefited from the market's mood, up 6c at $4.68.

Infrastructure investor Infratil was 5c higher at $3.24, NZX rose 15c to $11.60, and Sky TV was up 13c at $5.70.

Among other in-play stocks, Tourism Holdings rose a cent to $2.74 and The Warehouse was flat at $5.98.

Australia's benchmark S&P/ASX 200 Index was up 0.9% at 6343.4, while in Tokyo the Nikkei average rose 1%, on its way to its highest close in nearly four months.

On Friday, US stocks rose for a third straight day after tame consumer price data put aside inflation fears, while an upgrade of bellwether Intel helped fuel gains in the tech sector.

The Nasdaq climbed to its highest in more than six years, and the Dow finished the week within about 53 points of its all-time high, as favourable economic and corporate news overshadowed worries about interest rates that dominated the market earlier in the week.

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