Market close: Fletcher climbs on earnings optimism, Kathmandu up, as shares rise

New Zealand shares rose as early signs the earnings season is tracking OK lifted shares such as Fletcher Building. Pumpkin Patch led retailers exposed to the Australian market.

The NZX 50 Index rose 17.80 points, or 0.4 percent, to 4239.19. Within the index, 29 stocks rose, 10 fell and 11 were unchanged. Turnover was a stronger-than-average $157 million.

"There's cash finding its way from term deposits and bonds back into equity markets," says Shane Solly, portfolio manager at Mint Asset Management. "At this early stage of earnings we've seen companies meet guidance."

Fletcher, the biggest company on the NZX 50, rose 1 percent to $9.03. The construction and building products firm reports its interim results next Wednesday and is expected to lift profit by 2 percent, according to First NZ Capital.

Pumpkin Patch, the children's clothing chain that counts Australia as its largest market, rose 5.1 percent to $1.44. The Westpac/Melbourne Institute Consumer Sentiment Index rose by 7.7 per cent to 108.3 in February, the highest level in more than two years.

Kathmandu, the outdoor equipment chain, climbed 3.1 percent to $2.33. Jewellery chain Michael Hill International rose 0.8 percent to $1.23. Warehouse Group, the biggest New Zealand retailer, rose 1.7 percent to $3.50.

Summerset Group, the retirement village operator, fell 2.4 percent to $2.48, the lowest in a week, on speculation private equity firm Quadrant will be looking to exit its majority holding when a restraint of sale ends this month.

"Summerset has been delivering some pretty good outcomes operationally," Mr Solly says. Still, "Quadrant is an unnatural long-term holder".

Auckland International Airport, the nation's busiest gateway, rose 1.4 percent to $2.49, bringing its gain this year to 6.7 percent. Its first-half results next week are expected to show 4.2 percent growth in earnings before one-time items, on stronger domestic demand, according to Forsyth Barr analyst Andy Bowley.

Telecom slipped 2.2 percent to $2.22, which Mr Solly says may reflect investors moving into stocks a bit more sensitive to economic growth. Telstra declined 1.4 percent to $5.68 on the NZX.

OceanaGold, operators of the Macraes goldfield, fell 1.6 percent to $3.10. Its full-year results are out tomorrow and are expected to show a 51 percent drop in reported profit pre-abnormals, according to Forsyth Barr.

Nuplex Industries, which makes specialty chemicals and resins, rose 1.7 percent to $3.53.

The BNZ-Business New Zealand Performance of Manufacturing Index climbed 4.8 points to 55.2 last month, the highest since May last year.

Freightways, the courier and logistics firm, rose 2.2 percent to $4.57 before its first-half results on Monday.

(BusinessDesk)