Market close: NZ shares rise, pushing NZX 50 to June high

BUSINESSDESK: New Zealand shares rose pushing the NZX 50 index to its highest level this month, as cloud-based accounting firm Xero benefited from its inclusion in the benchmark index while Air NZ rose after announcing a new chief executive.

The NZX 50 rose 24.70 points, or 0.7%, to 3480.38. Within the index, 32 stocks rose, nine fell and nine were unchanged. Turnover was about 124 million.

Air New Zealand, the airline slated for a government sell-down, rose 0.6% to 87 cents after naming Christopher Luxon as chief executive. Mr Luxon, the airline’s general manager for international, will replace Rob Fyfe at the end of the year.

"Luxon is an existing part of the firm but investors want proof of the pudding - he will need to show he can move the share price," said Paul Vault, investment adviser at Craigs Investment Partners.

The stock has shed 21% in the past year and is rated "outperform" based on the consensus of seven analyst recommendations compiled by Reuters.

Telecom, New Zealand’s biggest listed company, rose 1.8% to $2.535. The company said today it has added a further $400 million to its bank credit lines which will use to repay short-term debt and general corporate purposes.

It has set up a two- and three-year revolving credit facility with Westpac Banking in addition to its as-yet undrawn $600 million syndicated committed standby credit facility established in April.

Trade Me shares rose 0.8% to $3.79 after Sydney-based Fairfax sold down its stake in the online auction site yesterday for a total $A160 million.

"There was speculation in the market that Fairfax might sell down its stake and what Trade Me shares are doing now is recovering," Mr Valk said.

Xero shares rose 3.4% to $4.89 after the locally-listed tech-company entered the benchmark NZX 50 yesterday.

Shares in Diligent Board member Services, which also joined the NZX 50 yesterday, gained 1.7% to $3.57.

F&P Healthcare, which makes breathing masks and gets more than 50% of sales in US dollars, fell 2.3% to $2.10 as the kiwi dollar edged up to 79.31 US cents today, the highest since early May. The company sheds its final dividend of 7 cents a share tomorrow.

Shares in carpet marker Cavalier fell 2.4% to $1.65.

Goodman Property Trust was unchanged at 99 cents, with 11.6 million shares changing hands.

The trust’s manager, Goodman (NZ) Ltd, said it is developing a new 5340 square metre office building at the Central Park Corporate Centre in Greenlane, Auckland, at a cost of $21.4 million.

“Our business is continuing to attract strong levels of customer enquiry and we are extremely pleased to be commencing the next phase of development at this strategically located office park,” Goodman (NZ) chief executive John Dakin said.

Fletcher Building gained 0.2% to $6.31 and Contact Energy rose 1.9% to $4.88.