Market close: Shares fall as rally runs out of puff - Contact, Chorus decline
New Zealand shares fell as some investors sold shares in one of the world's best-performing equity markets this year. Contact Energy and Chorus paced the decline.
The NZX 50 Index fell 10.75 points, or 0.3%, to 4030.77. Within the index, 26 stocks fell, 13 rose and 11 were unchanged. Turnover was about $126 million.
So far this year the index has gained 23%, while Australia's S&P/ASX 200 Index is up 12% and America's Standard & Poor's 500 Index has risen about 13%.
"The New Zealand market has had a pretty strong run and some people are asset allocating away from NZ equities," says David Price, a broker at Forsyth Barr.
"There's an absence of real strong buying interest." Still, the selloff was a pause and he expected New Zealand stocks would continue to rise.
Contact, the biggest power company on the exchange, fell 2.3% to $5.20.
Chorus, the network company spun off from Telecom last year, dropped 2.2% to $2.73, a record low.
The company's plunge started last week, when it said earnings would be slashed if a draft determination on pricing from the regulator was enforced.
Telecom fell 0.9% to $2.265.
Warehouse Group rose 0.3% to $3.10 at the close, having declined during trading after the retailer said it would buy the unprofitable Noel Leeming chain from Gresham Private Equity for $65 million.
Some investors were hoping to see results from its existing refresh strategy for the Warehouse's red sheds before it embarked on an acquisition, Mr Price says.
Fletcher Building, the biggest company on the NZX 50, was at $8.33, the highest since early July 2011, amid optimism the rebuild of Christchurch is gathering pace.
Steel & Tube Holdings, which sells steel building materials, climbed 1.3% to $2.31.
Sanford, the fishing company, fell 3.5 percent to $4.40 after shedding its 14 cent final dividend.
Food manufacturer Goodman Fielder dropped 3.5% to 82 cents, the biggest decline on the benchmark index today.
OceanaGold fell 3% to $3.54. The shares resumed their decline after last week's surprise announcement that it had raised $C93.3 million selling 30 million shares for $C3.11 apiece in Canada.
PGG Wrightson, the nation's biggest rural services company, dipped 2.7% to 36 cents even after dairy giant Fonterra lifted its forecast milk payment to farmers.
Cavalier, the carpet maker and wool scourer, rose 1.8% to $1.70. Trade Me Group, the auction website, was up 1.7% to $4.21. Insurer Tower gained 1.1% to $1.88.