MARKET CLOSE: NZ shares join global rally; Warehouse gains after results

BUSINESSDESK: New Zealand shares rose, led by Warehouse Group, which posted its results on a day global equity markets advanced and provided some relief it didn’t reveal carnage from a weak retail market.

The NZX 50 Index rose 20.02 points, or 0.6 percent, to 3433.81. Within the index, 24 stocks rose, 17 fell and nine were unchanged. Turnover was $136 million, making it one of the busiest days this year.

Warehouse gained 5.7 percent to $2.80. The biggest retailer on the NZX 50 today reported a decline in operating margins and cut its interim dividend by 2 cents to 13.5 cents. A one-time gain lifted net profit by 3.3 percent.

"The stock has already reacted to the news - it was a little bit of a relief that the dividend hasn't changed significantly," said Adrian Vance, a director at brokerage Hamilton Hindin Greene. “I think you will start to see a little bit more support for the Warehouse now.”

Shares rallied across Asia as investors took heart from progress on Greece’s bailout and optimism non-farm payrolls will confirm private sector numbers and show the US is stacking on jobs once again. The Nikkei 225 Index was up more than 2 percent in early afternoon trading.

Among other retailers, Briscoe Group climbed 4.1 percent to $1.53.The homeware and sporting goods retailer today posted a record full-year profit of $27.5 million. Sales were up 8 percent on a same store basis. Its gross profit margin slipped to 39.52 percent from 39.77 percent as retailers battled for sales in a tepid market.

Retailing "has been overlooked, so people are looking at the results now,” Vance said.

Telecom extended its gains, rising 2.4 percent to $2.385, another post-split high. It has a dividend yield of 12.9 percent based on the past 12 months of payments.

“Telecom has had a great week on the result and the underlying yield - it has prompted international interest," Vance said.

Fletcher Building, the nation’s biggest construction company, rose 0.5 percent to $6.63 as some investors looked beyond its current weaker earnings to a time when the rebuild of Canterbury is in full swing.

New Zealand Oil & Gas rose 2.7 percent to77 cents. The oil company owned almost a third of Pike River Coal, which failed after deadly explosions halted production. Today state-owned coal miner Solid Energy said it had agreed to buy the mine for an undisclosed sum.

Guinness Peat Group extended its gains, rising 2.9 percent to 52.5 cents amid speculation it may be closer to deciding on the sale of its holding in insurer Tower, which fell 1.2 percent to $1.67.