Fletcher rebound leads market up in choppy trading

The New Zealand sharemarket bounced back with a gain of more than half a per cent, helped by a recovery in Fletcher Building and a sharp rise from utilities investor Infratil.

The S&P/NZX 50 Index traded strongly in the afternoon and closed at 11,724.48, up 84.44 points or 0.73 per cent. The index finished the week shedding nearly 1.2 per cent.

There were 85 gainers and 51 decliners over the whole market on volumes of 26.85 million share transactions worth $109.73m.

Shane Solly, portfolio manager with Harbour Asset Management, said there was another twist from the Reserve Bank with its re-focus on fighting core inflation.

“The market is quite choppy at the moment and some of the price movements are quite extreme. But there was some positive news from Infratil and Meridian,” he said.

“We have a massive week coming up with 19 companies reporting their financial results. The market has curbed its enthusiasm for early interest rate cuts — they’ve been pushed back from the third to fourth quarter this year — and now it’s back to the earnings performances, with companies having to show us the money.”

Meridian Energy, the largest local stock on market capitalisation, was up 12c or 2.14 per cent to $5.72 after reporting an 8.3 per cent rise in retail sales volumes in January compared with the same month last year. Small medium business sales were up 7 per cent, large business 11.1 per cent and agriculture 19.2 per cent.

Meridian said national hydro storage increased from 84 per cent to 101 per cent of historical average for the month ending February 14.

Infratil, which has 7.5 per cent weighting on the NZX index, rose 29c or 2.84 per cent to $10.49. Solly said Infratil’s peers overseas have come out with strong profit outcomes, particularly involving data centres.

Fletcher Building rebounded 17c or 5.07 per cent to $3.52. Solly said “the train smash that is Fletcher was heavily sold in the close the day before, people have had time to digest the numbers and we saw a bounceback in the share price.

“The Fletcher management has been doing the rounds and talking to investors. Fletcher still has significant liabilities that are hard to quantify and the market will still remain wary,” he said.

Ebos Group, reporting Wednesday, gained 62c to $37.36; Spark collected 5.5c to $5.19; Vector added 8c or 2.13 per cent to $3.84; PGG Wrightson rose 19c or 6.31 per cent to $3.20; Napier Port was up 6c or 2.47 per cent to $2.49; and Restaurant Brands added 10c or 2.9 per cent to $3.55. Retailers Hallenstein Glasson gained 8c to $5.59; KMD Brands was up 2c or 3.28 per cent to

63c; The Warehouse rebounded 3c or 2.24 per cent to $1.37; and Michael Hill was down 3c or 3.53 per cent to

82c. Vital Healthcare Property Trust increased 4c to $2.17.