New Zealand shares rise, joining a global equity markets rally after European leaders agree to use their rescue funds to aid the region's lenders. Telecom and Fletcher Building paced the advance.
BUSINESSDESK: New Zealand shares rose, joining a global rally in equity markets after European leaders agreed to use their rescue funds to aid the region’s lenders. Telecom and Fletcher Building paced the advance.
The NZX 50 Index rose 40.32 points, or 1.2%, to 3440.16. Within the index, 31 stocks rose, nine fell and 10 were unchanged. Turnover was a lower-than-average $77.8 million.
The local bourse rose after the Standard & Poor’s 500 Index climbed 2.5% in New York on Friday while Germany’s DAX 30 gained 4.3%.
On Friday, EU leaders agreed to allow their joint emergency funds to be tapped by the region’s banks and pledged to create a single banking supervisor for eurozone banks, moves that may alleviate the debt crisis.
Fletcher Building, the biggest construction company on the NZX, rose 3.2% to $6.06 after announcing the sale of the metals distribution businesses it acquired when it bought Crane Group last year for about $70 million.
Telecom, the biggest company on the bourse, climbed 2.5% to $2.45. Cavalier, the wool processing and carpet group, gained 4.6% to $1.59, the biggest percentage gain on the NZX 50. Nuplex Industries, the specialty chemicals company, was up 1.6% to $2.54.
“Sentiment has certainly improved. We saw some positive thing come out of the summit in Europe,” said Michael Milne, an adviser at Craigs Investment Partners. Still, “markets are pretty fickle at the moment”.
Courier and data management group Freightways rose 0.8% to $3.83 after saying it had bought printing and data management firm Dataprint NZ Ltd for up to $6.5 million, including $3.5 million based on meeting performance targets over the next three years.
Dataprint would be “immediately earnings-per-share positive” and funded from existing debt facilities, managing director Dean Bracewell said.
Retailers were mixed. Pumpkin Patch, the children’s clothing chain, fell 3.3% to 88 cents. Michael Hill International declined 2% to 96 cents.
Clothing chain Hallenstein Glasson Holdings rose 1.5% to $4.06 and outdoor equipment retailer Kathmandu climbed 2.4% to $1.30. Warehouse Group, the biggest retailer on the NZX 50, rose 2% to $2.55.
Australian lender Westpac Banking Corp was up 1.3% to $27.40 and Australia & New Zealand Banking Group climbed 2% to $28.60, tracking gains in their shares on the ASX.
Goodman Fielder, the Australasian food maker, rose 4.4% to 72 cents.
TrustPower, the power company controlled by Infratil, was unchanged at $7.56 after saying it is committing to the full cost of the $A465 million stage two development of the Snowtown South Australian wind farm. It had planned to find a partner though that has now been delayed.
Infratil was unchanged at $2.03.
NZ Farming Systems Uruguay rose 3.6% to 57 cents and PGG Wrightson, the nation’s biggest rural services company, was up 3.5% to 30 cents.
