Index expectations make for hot properties

Property companies Argosy, Stride and Vital Healthcare lit up the New Zealand sharemarket on the promise that they may be included in the main global real estate index.

Stride and Argosy both hit new highs as the S&P/NZX50 Index closed the week at 12,711.84, up 28.2 points or 0.22 per cent. There were 70 gainers and 58 decliners over the whole market on volume of 49.3 million share transactions worth $187m.

Stride rose 9c or 3.66 per cent to $2.55; Argosy was up 5c or 3.07 per cent to $1.68; and Vital Healthcare increased 13c or 4.10 per cent to $3.30 on news that the FTSE EPRA/Nareit Global Real Estate Index was lowering its criteria for inclusion.

The index is designed to track the performance of listed property companies in both developed and emerging countries worldwide. Its constituents are admitted on liquidity, size and revenue.

Matt Goodson, managing director of Salt Funds Management, said the property companies’ price movements illustrate the sheer size of investing by passive funds.

Argosy has increased 27c this week; Vital Healthcare, nearing its high of $3.37 set on January 25, rose 26c; and Stride was up 19c — all rising by nearly 10 per cent.

Goodson said “we won’t know until the start of September which stocks are going into the index but Argosy, Stride and Vital Healthcare could well join Kiwi Property, Precinct Properties and Goodman Property Trust, which are already there.”

A re-energised a2 Milk went over $7 for the first time since May, closing at $7.01, up 38c or 5.73 per cent — but the global milk marketer is still down 64 per cent over the past 12 months. Sister company Synlait was down 7c or 1.88 per cent to $3.66.

Market leader Fisher & Paykel Healthcare fell 25c to $30.46; Chorus was down 9c to $6.29; Pushpay Holdings declined 4c or 2.23 per cent to $1.75; Meridian Energy decreased 14.5c or 2.72 per cent to $5.18; and Scales Corporation shed 6c to $4.63.

SkyCity Entertainment lost 4c to $3.41; Tourism Holdings was also down 4c to $2.50; and AFT Pharmaceuticals fell 15c or 3.23 per cent to $4.50.

Freightways rose 37c or 2.95 per cent to a new high of $12.92; Ryman Healthcare gained another 28c or 2.08 per cent to $13.72; Arvida continued its strong run, increasing

5c or 2.4 per cent to $2.13; Restaurant Brands collected 30c or 2.07 per cent to $14.80; and new listing DGL Group was up

8c or 5.44 per cent to $1.55. Publisher and broadcaster NZME rose 9c or 11.84 per cent to 85c after benefiting from a broker’s upgrade earlier in the week.