MARKET CLOSE: NZ shares drop for fifth session; Auckland Airport, Chorus, TradeMe fall

New Zealand shares dropped for the fifth consecutive session to a near-three-month low, led down by Auckland International Airport, Ryman Healthcare and Chorus.

The S&P/NZX50 Index fell 50.88 points, or 0.7 percent, to 7,116.93. Within the index, 34 stocks dropped, 12 rose and four were unchanged. Turnover was $109 million.

"The downtrend in the New Zealand market is all about the yield play, it's the perception of higher interest rates in the US that's shifted money away from our quasi-bond yielding stocks," said Daniel Metcalfe, senior investment adviser at OMF. "There's some profit-taking after what's been a very good 12 months for New Zealand equities."

Auckland International Airport was the worst performer on the index today, down 3.3 percent to $6.72, and has declined 21 percent this year.

"There's broad-based selling in heavyweight New Zealand stocks," Metcalfe said. "The rise in the oil price has weighed on airlines, and I suppose you could read it's going to weigh on Auckland Airport as well with cost constraints coming through, but I don't think there's going to be a massive continued run in the oil price, I think the weakness in both Air New Zealand and Auckland Airport will be limited - you will see some people seizing this opportunity."

Ryman Healthcare dropped 2.5 percent to $8.95 and Chorus fell 2.4 percent to $3.67.

TradeMe declined 0.9 percent to $5.33, a two-month low. Founder Sam Morgan announced he intends to leave the board within the next year but will remain a shareholder.

Metcalfe said the stock's "fairly aggressive selldown" over the past week was attributable to competition in the form of Facebook's Marketplace, the social media giant's own online classifieds option.

Heartland Bank was the best performer, up 2 percent to $1.53, while Tower gained 1.7 percent to 92.5 cents and Meridian Energy rose 1.4 percent to $2.625.

Outside the benchmark index, Michael Hill International gained 1.2 percent to $1.75. The jewellery chain business founded by its namesake delivered 6.8 percent sales growth in the three months to Sept. 30 as it gears up for the busy Christmas period. Group sales from all stores rose to A$120.2 million in the first quarter of Michael Hill's financial year, from A$112.5 million in the same quarter in 2015. Same-store sales grew 2.8 percent to A$114 million in the three months.

Hellaby Holdings rose 0.3 percent to $3.34. ASX-listed Bapcor's $322.5 million takeover bid for the company has delayed its plans to freshen up its boardroom, chairman Steven Smith told shareholders at its annual meeting in Auckland. The offer price is $3.30 per share, though Bapcor chief Darryl Abotomey hasn't ruled out lifting the bid.

(BusinessDesk)