Market close: shares fall on signs of weaker Australian growth – Nuplex drops

New Zealand shares fell, paced by Nuplex Industries, as investors fret about the pace of Australia's economic growth, the impact on earnings across the Tasman for kiwi companies and the reduced prospects for an interest rate cut.

The NZX 50 Index fell 17.7 points, or 0.4 percent, to 4470.51. Within the index, 30 stocks fell, 14 rose and were unchanged. Turnover was $149 million.

Nuplex, the manufacturer of specialty chemicals used in paints and adhesives, fell 3.5 percent to $2.79, the lowest since August last year.

On May 17, the company cut its full-year earnings guidance, citing weak demand from Australian manufacturers. Figures today showed first-quarter capital spending 4.7 percent against expectations in a Reuters survey of a 0.8 percent gain.

"Things are just not going as well over there," says Greg Easton, an adviser at Craigs Investment Partners. "Confidence is really sliding, which is spilling over into our market."

Australia's S&P/ASX 200 Index was down 1.1 percent in late afternoon trading.

Pumpkin Patch, which sells children's clothes and counts Australia as its biggest market, fell 2.7 percent to $1.09. Brisbane-based Michael Hill International, the jewellery chain, declined 1.4 percent to $1.37.

Skellerup, the manufacturer of rubber goods and milking equipment, fell 2.9 percent to $3.36.

Ebos, the medical supplies and pet products distributor that has agreed to acquire an Australian drugs supply business, rose 5.5 percent to $10.60, a record close.

Ebos plans to acquire the Symbion pharmaceutical wholesaler and distributer in Australia for $1.1 billion from Hong Kong's Zuellig Group in a deal that will give Zuellig 40 percent of Ebos.

The deal "is transformational," Mr Easton says. "It has been taken very well. They have negotiated a fantastic price." Zuellig staying in is "a vote of confidence".

Fletcher Building, the biggest company on the bourse, fell 0.2 percent to $8.36 after government figures showed the biggest monthly issuance of new building permits in five years last month.

Steel & Tube, which has greater exposure to commercial construction, was unchanged at $2.50 as the Statistics New Zealand data showed the value of non-residential construction were up 35 percent to $308 million in April from the same month a year earlier.

Units in the Fonterra Shareholders' Fund fell 3 percent to $7.68 after rival Westland Milk followed Fonterra's lead in hiking its 2014 forecast payout to farmers to between $6.60 to $7 per kilogram of milksolids. Fonterra yesterday raised its forecast to $7 per kgMS.

Tenon jumped 16 percent to $1 after the wood mouldings maker said it may return to profit this year as the US housing market picks up.

Operating profit before finance costs would be between zero and $US1 million in the year ending June 30, from a loss of $US8 million a year earlier, the company said. Rubicon, which owns 59 percent of Tenon, gained 11 percent to 30 cents.

NPT rose 7.9 percent to 68 cents after it returned to profit with net earnings of $33 million in the 12 months ended March 31 from a loss of $2.3 million a year earlier. The gain was underpinned by an $11.3 million boost in the value of the property investor's portfolio.

Moa Group gained 1.7 percent to $1.22 after the boutique beer brewer lifted pro-forma annual sales 81 percent to $4.38 million, even as it posted a bigger EBITDA loss than expected of $3.61 million. The company spent $1.09 million on sales and marketing in the period, including investing in the New Zealand PGA gold tournament.

PGG Wrightson sank 3.1 percent to 31 cents after managing director George Gould said he's stand down in August. Mr Gould stepped into the role after former boss Tim Miles unexpectedly left in 2010 with a $3 million golden handshake.

Shares in Metlifecare were still halted at $3.38 after the retirement village operator and developer flagged plans to raise $80 million through a placement and share purchase plan to repay debt.

(BusinessDesk)