Market commentaries
WELLINGTON: New Zealand shares rose yesterday ahead of the MSCI rebalancing today, with possible addition a2 Milk leading gains while Fletcher Building and Mercury New Zealand, rumoured to be leaving, dropped.
The S&P/NZX 50 Index gained 36.54 points, or 0.4%, to 8713.23. Within the index, 19 stocks rose, 17 fell and 11 were unchanged. Turnover was $93 million.
The MSCI index review announcement is due this morning, New Zealand time.
James Lindsay, senior portfolio manager at Nikko Asset Management, said the rebalancing would have a clear impact on a2 Milk Co, which has been the top pick to enter the index, and the two stocks it might replace, Fletcher Building or Mercury New Zealand.
A2 Milk led the index higher, up 2.6% to $13.30. The stock has gained 62% so far this year but has dropped back from the record $14.10 it reached on March 22. The stock has been gaining for a couple of weeks as MSCI rumours have swirled.
Gentrack Group rose 2% to $7.50, Mainfreight gained 1.7% to $25.85, and Synlait Milk advanced 1.4% to $10.19.
Australia and New Zealand Banking Corp was the worst performer, dropping 2.4% to $29.80. Sky Network Television fell 1.8% to $2.17 and Pushpay Holdings declined 1% to $4.12.
Mercury fell 0.8% to $3.155. It has agreed to buy 19.99% of Tilt Renewables from the Tauranga Electricity Consumer Trust for $144 million, or $2.30 a share, a 24% premium to its last trading price.
Fletcher Building dropped 0.3% to $6.37. Along with possibly exiting the MSCI index, the retail component of the company’s $750 million capitalraising closed on Friday and will be followed by a bookbuild for any entitlements not taken up.
In April, the company generated gross proceeds of $515 million from the institutional component.
The Australian sharemarket closed higher, with gains in the resource and healthcare sectors overshadowing a hefty fall in Telstra shares to an almost sevenyear low.
Shares in Telstra tumbled 16c, or 5%, to $3.04, the lowest level since September 2011.
Telstra said it had added 36,000 subscribers in fixed data and had an NBN market share of 50% in the third quarter but price competition was cutting the value of each subscriber bundle and its own costs for accessing the NBN were affecting underlying earnings.
Among the energy players, Woodside Petroleum was up 45c, or 1.3%, to $33.97, Santos gained 5c, or 0.8% to $6.25, and Origin Energy was steady at $9.85.
In the mining sector, Rio Tinto gained 0.7% to $84.50 and BHP Billiton rose 1.9% to $33.79 as global iron ore prices ticked higher.
Healthcare giant CSL advanced $1.14, or 0.7%, to $176.90, while shares in hospital operator Healthscope jumped 11c, or 4.5%, to $2.58 after it received a second takeover offer that values it at $4.35 billion.
The big lenders were higher with the exception of ANZ and Macquarie, both trading exdividend yesterday. Commonwealth Bank recovered from morning losses to lift% 0.4% to $70.80, after its chief financial officer Rob Jesudason stepped down after less than a year.
Elders shares rose 30c, or 3.7%, to $8.40 after the agricultural specialist lifted its halfyear profit by eight% to $41.4 million.
Shares in News Corp were $1.40, or 6.2%, weaker at $21.10 three days after the media giant reported a $US1.1 billion thirdquarter loss.
Building fixtures supplier GWA Group rose 21c, or 5.7%, to $3.93 after it said it will sell its door and access systems business.
The Australian dollar was higher against the United States dollar, which appears set for its fourth straight day of losses, as currency traders lock in profits following the greenback’s recent rally.
By late afternoon, the Australian dollar was worth US75.45c, up from 75.38c on Friday.
The benchmark S&P/ASX200 was up 19.1 points, or 0.31%, to 6135.3 points. The broader All Ordinaries index was up 18.6 points, or 0.30%, to 6235 points.
The SPI200 futures contract was up 26 points, or 0.43%, at 6122 points. National turnover was 2.9 billion securities traded worth $6.8 billion. — BusinessDesk/AAP