Fletcher leads shares higher
Construction company rebounds on bargain hunting, analyst says
New Zealand shares rose, led higher by Fletcher Building and Spark New Zealand, while A2 Milk Co and Kathmandu Holdings weakened. The S&P/NZX 50 Index gained 41.74 points, or 0.5 per cent, to 8172.6. Within the index, 24 stocks rose, 14 fell and 12 were unchanged. Turnover was $145 million.
“Offshore markets didn’t give us too much of a lead and the market was probably just recovering from the first three days of the week, which were pretty poor,” said Grant Williamson, director at Hamilton Hindin Greene. “The closer we get to Christmas the more the volumes will continue to fall back.”
Fletcher Building led the index, up 3.2 per cent to $7.01.
“There has been a lot of interest focused on Fletcher Building for no particular reason but its oversold position — it has bounced back up on bargain hunting,” Williamson said.
Spark New Zealand rose 2.5 per cent to $3.64 and Air New Zealand gained 2.1 per cent to $3.225.
Kathmandu Holdings was the worst performer, down 2.1 per cent to $2.34, with Mainfreight down 1.5 per cent to $24.15 and Tourism Holdings falling 1.3 per cent to $5.30.
A2 Milk Co dropped 1.9 per cent to $7.93. It has settled a court case in Australia with its rival Lion Group. Lion had brought a case against A2 over the science behind health-related claims about the milk, with A2 countersuing over its milk brand’s use of A2 protein claims, seeking an injunction and damages. Both companies have agreed not to pursue their claims and have come to a confidential settlement.
“That share price has got a mind of its own. The news didn’t have too much of a bearing on the stock at all,” Williamson said.
Z Energy dropped 0.8 per cent to $7.62. On Wednesday, the Government said it has asked the Ministry of Business, Innovation and Employment to further investigate fuel prices and is looking to increase the Commerce Commission’s market studies powers by the end of next year.
“There’s been a lot in the media and it has got one or two investors a little bit nervous,” Williamson said.
Trustpower dipped 0.5 per cent to $5.95. It is eyeing up King Country Energy’s retail business as it teams up with King Country Electric Power Trust to buy out the remaining minority shareholders.
The Tauranga-based utility company will form an unincorporated joint venture with the trust, which owns 19.98 per cent of King Country Energy, which will then make a takeover offer for the central North Island generator and retailer, it said. The $5 a share offer is a premium to the $4.50 the shares last traded at on the Unlisted exchange before being halted on December 3.
Outside the benchmark index, Tegel Group fell 3.3 per cent to $1.18. It dropped nearly 13 per cent on Wednesday after it said first-half earnings fell 2.3 per cent, missing estimates and stoking concern it has not managed to stabilise profitability as competition restrains domestic prices.
Opus International Consultants was unchanged at $1.81. It will de-list in January, its shares to be suspended from Monday after being acquired by Canadian listed consultancy firm WSP Global Inc. —