Sky TV, Fletcher lead declines
Broker says with such low turnover hard to read moves
New Zealand shares fell, led by Sky Network Television, Genesis Energy and Fletcher Building, while Kathmandu Holdings and Synlait Milk gained.
The S&P/NZX 50 Index dropped 34.09 points, or 0.4 per cent, to 8,363.99. Within the index, 23 stocks dropped, 21 rose and six were unchanged. Turnover was $126 million.
David Price, a broker at Forsyth Barr, said some stocks were seeing large swings at the moment, but with such low turnover little could be read into the moves.
Sky Network Television was the worst performer, down 6 per cent to $2.21.
Price said the pay-TV provider’s new pricing options, which it introduced in February in an effort to slow an exodus of customers quitting in favour of cheaper on-demand rivals, will have customers looking at their bills and deciding whether to spin down — reduce their subscription features and what they pay Sky.
“One of two things will happen: we’ll hear nothing until August, and that will be a good sign. Or, we could get an update before then, because what happens is 90 per cent of the people that spin down do it in the first six months. We just don’t know, that’s the problem and that’s why the stock just wishy-washes around on quite a low volume,” Price said.
Genesis Energy dropped 3.4 per cent to $2.305, Fonterra Shareholders’ Fund fell 3.2 per cent to $5.71, and Mainfreight declined 2.8 per cent to $24.00.
Fletcher Building dropped 0.4 per cent to $5.76, the lowest it has closed since March 2009. Price said there were concerns about the potential for the stock to fall out of the MSCI New Zealand Index at its next rebalancing, to be replaced by A2 Milk Co. A2 was unchanged at $12.92.
Kathmandu Holdings was the best performer, up 2.9 per cent to $2.50, while Auckland International Airport gained 1.9 per cent to $6.36 and New Zealand Refining Co rose 1.7 per cent to $2.37. Synlait Milk gained 1.5 per cent to $9.08. It will spend about $18 million to double production of lactoferrin at its Dunsandel plant after securing a multi-year agreement to supply the high- value milk protein to an unnamed customer.
Scott Technology gained 4.5 per cent to $3.50. It boosted first-half profit 26 per cent to $3.1m. —