MARKET CLOSE: NZ shares slip as appetite for yield stocks dims

New Zealand shares slipped in thin holiday trading as appetite declined for companies offering attractive dividend yields, such as regulated utilities Chorus and Genesis Energy and pay-TV operator Sky Network Television.

The S&P/NZX 50 index decreased 20 points, or 0.2%, to 8374.43. Within the index, 25 stocks fell, 16 gained, and nine were unchanged. Turnover was a lighter-than-normal $65.8 million.

Genesis Energy led the benchmark index lower, falling 2.7% to $2.46. Chorus fell 2.6% to $4.16, Mercury NZ dropped 2.2% to $3.355 and Sky TV declined 2.1% to $2.78.

"Some of the interest rate sensitive stocks, such as Chorus, Mercury and Sky, are down – they're the ones dragging the market down into the close," said Shane Solly, portfolio manager at Harbour Asset Management.

"What we've seen globally, led out of the US, is long-term bond yields creep up slightly from being very low, and we're seeing people think about what will happen in the next 12 months."

Still, he said trading was very light due to the Christmas/New Year holiday period.

Kiwi Property Group posted the biggest gain on the day, up 2.5% to $2.145, followed by retirement village operator Summerset Group, which rose 2.2% to $5.50.

Tourism Holdings advanced 2.1% to $5.77. The rental campervan operator last week said it expected net profit to get a boost from US tax cuts.

Restaurant Brands New Zealand gained 1.4% to $7.15. Paymark figures showed retail spending increased 6.4% on Boxing Day from a year earlier, with spending at fast food outlets up 16%.

Trade Me, the online auction site, fell 0.4 percent to $4.78, while outside the benchmark index Briscoe Group rose 1.8 percent to $3.33, Warehouse Group gained 1.5 percent to $2.09, and Kathmandu was unchanged at $2.40.

Augusta Capital was unchanged at $1.065 after the real estate funds management firm secured a second property for a planned industrial fund to be launched next year.

AFT Pharmaceuticals closed unchanged at $2.39 after the drug-maker said it has licensed its Maxigesic painkiller to Laboratories Expanscience's Mexican subsidiary, marking the firm's 125th licensed country for the drug.

Among leading stocks, Fisher & Paykel Healthcare was unchanged at $14.14, Auckland International Airport slipped 0.2% to $6.56, a2 Milk Co gained 0.4% to $8.16, Meridian Energy fell 0.5% to $2.915, Spark New Zealand was unchanged at $3.62, and Fletcher Building decreased 0.4% to $7.65. Xero fell 1 percent to $31.40.