Market close: NZX 50 highest in almost 5 years; Wrightson, Vector, Contact gain
New Zealand's benchmark NZX 50 Index to its highest close in almost five years, joining a global rally amid demand for higher yields and optimism Europe will grant Greece its next tranche of financial aid.
PGG Wrightson, Vector and Contac t Energy gained.
The NZX 50 gained 3.69 points, or 0.1%, to 4012.02, the highest since early January 2008. Within the index, 19 stocks rose, 17 fell and 14 were unchanged. Turnover was about $87 million.
The Dow Jones Industrial Average rose 1.4% on Friday, rounding out a 3.3% weekly gain. In Asia today, Japan's Nikkei 225 Index was 0.7% higher in early afternoon trading.
"It was a big week last week with offshore markets playing risk on," says David Price, a broker at Forsyth Barr. "It is a global phenomenon where it doesn't pay to be a saver" and that is prompting investors to take on more risk and buy shares.
Wrightson, the nation's biggest rural services company, gained 6.1% to 35 cents, a three-week high. The stock is rated "outperform" based on the consensus of five analysts polled by Reuters, with a price target of 49 cents.
Vector, the Auckland-based lines company, rose 1.9% to $2.66, recovering from the five-month low reached on Friday.
The stock has tumbled in the past two weeks after the company lost its final appeal against the way the Commerce Commission set starting prices for the new regime regulating prices for its monopoly services.
Contact, the biggest utility on the exchange, rose 1.4% to $5.15.
Fletcher Building, the biggest company on the exchange, fell 0.3% to $7.97, having closed above $8 on Friday when brokerage Forsyth Barr upgraded the stock to a "buy".
Heartland New Zealand rose 1.5% to 70 cents. The building society said after the market closed that it expects to find out the success of its application for a banking licence before Christmas, having previously anticipated a decision in November.
Fisher & Paykel Healthcare rose 1.6% to $2.50, the highest close in 11 months.
Last week the maker of breathing masks and respirators beat its guidance with an 18% gain in first-half profit, making record sales while keeping a rein on costs and widening its margins.
It said profit in the full year would also beat its estimate.
Among smaller companies, NZ Experience, the operates the Rainbow's End fun park, jumped 9.8% to 45 cents after Wellington-based Rangatira indicated it would acquire the 74.86% stake owned by the Trustees of the Estate of George Ryerson Gardiner as part of a full takeover at 36 cents a share.