Market close: NZ shares rise on upbeat Australian view

BUSINESSDESK: New Zealand shares rose, led by companies exposed to the Australian economy after strong jobs and economic growth data lifted companies that get revenue across the Tasman. 

Pumpkin Patch led the advance, while Westpac and ANZ Bank also gained.

The NZX 50 Index gained 9.44 points, or 0.3%, to 3473.95. Within the index, 24 stocks gained, 19 fell and seven were unchanged.

Turnover was $102.8 million.

In Australia, the S&P/ASX 200 Index climbed 1.3% in afternoon trading after government figures showed the economy added 46,000 full-time jobs last month.

The data came after first-quarter GDP yesterday showed the economy grew 4.3% in the first quarter from a year earlier.

Pumpkin Patch, the children’s clothing chain that counts Australia as its biggest market, rose 3.5% to 90 cents.

Michael Hill International, the jewellery chain that relocated to Australia, gained about 2% to $1.04.

Australian lender Westpac gained 2.8% to $26.85 and Australia & New Zealand Banking Group rose 2.4% to $28.18.

Nuplex Industries rose 1.3% to $2.42. The specialty chemicals company said this week that full-year earnings would be at the bottom end of its range although second-half trading has met expectations and margins have improved.

“Nuplex is an early beneficiary of the economic activity” in Australia, said Bryon Burke, head dealer at Craigs Investment Partners. Also, “they pleasantly surprised people that their forecasts are intact”.

Steel & Tube, which sells steel construction products, fell 5.5% to $2.06 following the NZX announcement late yesterday that it would drop out of the NZX 50 Index on June 18.

Rakon, which is also being ousted from the benchmark index, fell 2% to 48 cents.

They are to be replaced by two of the best-performing stocks on the bourse, cloud-based accounting service provider Xero, which gained 4.9% to $4.30 today and Diligent Board Member Services, which rose 2.6% to $3.50.

“It’s not that many trading days between now and their inclusion into the index – it’s a short time for people to start accumulating,” Mr Burke said.

Sky City Entertainment Group, the Auckland based casino and hotel operator, rose 1.7% to $3.56. Contact Energy, the biggest power company on the exchange, gained 0.4% to $4.76.

Auckland International Airport, the nation’s busiest gateway, was up 0.8% to $2.53 after announcing its proposed new fee structure, which will see a cut to international passenger fees in the 2013 financial year and an increase in domestic travellers’ charges.

Air New Zealand, the biggest domestic airline, fell 1.7% to 85.5 cents.

Chorus, the network company spun off from telecom last November, fell 1.8% to $3.20. The shares tumbled last month after the regulator issued a draft recommendation that Chorus should lower it charges for phone companies to access its lines.

“Chorus has come off of the boil a bit on the back of the Commerce Commission looking into it – it’s a bit of an unknown for investors,” Mr Burke said.

Telecom, the biggest company on the NZX 50, rose 1% to $2.50. Telstra, its Australian rival, fell 0.4% to $4.68 on the NZX.

Warehouse Group, the biggest retailer on the exchange, was down 2.3% to $2.51.