WELLINGTON: New Zealand shares rose, led by Kathmandu Holdings and Fletcher Building, with investor confidence not dented by political turbulence following Prime Minister John Key announcing his intention to resign yesterday. The S&P/NZX50 Index gained 55.66 points, or 0.8 percent, to 6,910.37. Within the index, 32 stocks rose, 12 fell and seven were unchanged. Turnover was $133.1 million.
“There are no discernable market changes to the political changes here, status quo expectation is policy as usual,” said Matt Goodson, managing director at Salt Funds Management. “The market hasn’t factored in the very slight chance there could be some sort of split in the National caucus, and it’s probably too early to factor in the next election and any impact on those as yet.” Kathmandu Holdings led the index, up 3.8 percent to $1.90, while Fletcher Building gained 2.9 percent to $10.42 and Tegel Group Holdings rose 2.7 percent to $1.55.
SkyCity Entertainment Group rose 0.5 percent to $3.85. New Zealand’s dominant casino company has named John Mortensen to the new role of group chief operating officer.Tilt Renewables was the worst performer on the index, down 3.7 percent to $1.80. “Probably the key upcoming thing is it’s almost certain to fall out of the NZX50 Index in the changes in a few days’ time, to date it has been a little problematic and hasn’t performed terribly well,” Goodson said. Fisher & Paykel Healthcare declined 2.3 percent to $8.20 while Stride Property dropped 1.7 percent to $1.79.
Trustpower fell 1.1 percent to $4.44. The Electricity Authority is ending subsidies to power stations that are embedded in local electricity networks rather than connected to the national grid in a move the regulator says will save consumers around $25 million to $35 million a year, or $279 million on a net present value basis. “In essence this means Trustpower will receive less revenue than under the way the old costs were worked out – it had been widely expected this would be the case, but certainly a negative for Trustpower, ” Goodson said.
Outside the benchmark, Scales Corp dipped 0.3 percent to $3.49. The best-performing stock on the S&P/NZX 50 Index this year, it raised its forecast for annual earnings with the apple company citing improvement across all its divisions and a standout performance from its horticulture unit. “It’s quite a sharp upgrade, really a favourable confluence of harvest volumes, harvest quality and apple prices, particularly in Asia,” Goodson said. “At the same time, they’ve given guidance for the following year which is a bit below this year, Scales have tended to be conservative early and then update. Delegat Group X. The owner of Oyster Bay wine has warned it will have to increase prices in the UK due to the sustained weakness of the pound following the vote for Britain to leave the European Union.
Hellaby Holdings gained 0.6 percent to $3.46 while ASX-listed Bapcor gained 0.3 percent to A$5.005. Bapcor has accused Hellaby’s directors of overreaching in their guidance to shareholders after they sought a further dividend payment before they’d back a sweetened takeover offer. Bapcor today raised its takeover offer to $3.60 a share from $3.30, but the board wants an 18 cent dividend added. Delegate Group was unchanged at $5.80 after saying it will need to increase prices of its wines in the UK because of the falling pound.
