Tourism Holdings the standout on quiet day

Fonterra cuts forecast after court ruling

New Zealand shares gained, with activity quieter and market attention focussed on Fonterra Cooperative Group after the company lost an arbitration battle with Danone. The S& P/ NZX50 index rose 0.025 per cent, or 2.01 points, to 8188.83. Within the index, 22 stocks rose, 21 fell and seven were unchanged. Turnover was $ 163 million.

Tourism Holdings was the best performer, up 3.8 per cent to $ 5.24, while Port of Tauranga rose 3 per cent to $ 4.74 and CBL Corp gained 1.6 per cent to $ 3.15.

Fonterra Shareholders Fund units gained 0.6 per cent to $ 6.40. Fonterra Cooperative Group has cut its forecast for 2018 earnings per share after an arbitration tribunal in Singapore ruled it must pay 105 million euros ($ 183m) to Danone after 2013’ s whey protein recall.

“In the share price you’ve seen an element of relief, albeit on low volume” said Rickey Ward, NZ equity manager at JBWere.

Ward said the Fonterra news had dominated the market, which was quieter following Thursday’s $ 1.48 billion in turnover on MSCI reweighting.

“You’ve got a bit of a remnant of that indexation that occurred. Rightly or wrongly it feels like a follow on from that,” Ward said. “It was the biggest day I can ever recall. It was also the end of the month, not the middle of the month. People get into report writing so the attention is not on the market on the following day of the month — it tends to be head down, writing reports. You’ve got an element of that in the market at the moment.”

Freightways was the worst performer, down 2.5 per cent to $ 7.80, while Precinct Properties fell 2.3 per cent to $ 1.30 and Z Energy dropped 2.1 per cent to $ 7.63.

Vital Healthcare Property Trust fell 0.7 per cent to $ 2.185. It has bought Acurity Health Group’s Royston hospital for $ 54m, having got Overseas Investment Office approval to acquire two other hospitals in the private operator’s portfolio.

Outside the benchmark index, Hallenstein Glasson Holdings rose 4.4 per cent to $ 3.56. It said its clothing retail chains had traded strongly so far this summer, with increased sales and margins. Sales for the first 17 weeks of the new financial year, from August 2 to November 30, were 15 per cent ahead of the same period last year.