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MARKET CLOSE: Shares gain as F&P Healthcare at record on weak kiwi, Air NZ fuel costs drop

Shares rose as the declining Kiwi dollar boosted companies that get their revenue in USD.

Jonathan Underhill
Tue, 09 Dec 2014

New Zealand shares rose as the declining kiwi dollar boosted companies that get their revenue in US dollars, such as Fisher & Paykel Healthcare, and Air New Zealand gained as crude oil at a five-year low held out the prospect of lower fuel costs.

The NZX 50 Index rose 13.611 points, or 0.3 percent, to 5542.933. Within the index, 24 stocks rose, 22 fell and four were unchanged. Turnover was $130.9 million.

F&P Healthcare, which makes respirators and gets almost half its sales in US dollars, rose 1.3 percent to $6.03. a record high after the kiwi fell to a 2 1/2-year low 76.10 US cents, lifting the value of offshore sales when they are repatriated.

"The kiwi's continued decline versus the US dollar is very positive for them," said Grant Williamson, a director at Hamilton Hindin Greene.

Air New Zealand rose 0.6 percent to $2.395 as the price of crude oil fell to its lowest levels in five years, helping drive down the price of jet fuel. The stock has also benefited from the company's announcement this week that it will buy two more Boeing Dreamliners to add to its fleet, which Williamson said showed a vote of confidence in its outlook.

Sky Network Television, the pay TV operator, fell 0.6 percent to $6.17. Much of is programming is priced in US dollars.

Spark New Zealand rose 3.2 percent to $3.03, the highest close in a week, bouncing back from investor disappointment last week that the regulator would allow network operator Chorus to charge more for access to its copper lines. Chorus fell 0.6 percent to $2.69.

Williamson said Spark's gain may also partly reflect "a bit of a flight to quality and yield" given the slump in the price of oil and broader concern about weaker commodity prices. At today's price, Spark has a prospective dividend yield of 6.2 percent, according to Reuters data.

Fonterra Shareholders' Fund units fell 0.6 percent to $6.17 ahead of an announcement expected from the dairy company on a revised milk payout forecast. Given the slide in dairy prices in the GlobalDairyTrade auctions, Fonterra is expected to slash its forecast below $5 per kilogram of milk solids. Synlait Milk rose 0.3 percent to $3.25 and A2 Corp, which markets milk with a protein variant said to have health benefits, dropped 1.6 percent to 60 cents.

Xero, the cloud-based accounting software company, fell 1.5 percent to $16.25. US fund manager Fidelity Investments today disclosed a 5.4 percent holding in the company.

Trade Me fell 2.7 percent to $3.65. the online auction site said it has agreed to buy rental property website Viewing Tracker for an undisclosed sum, adding to its property offering.

OceanaGold Corp rose 0.4 percent to $2.32. the operator of the Macraes goldfield in Otago said today it expects its annual gold and copper production to be largely flat in the year, while signalling costs may fall as much as 13 percent.


Jonathan Underhill
Tue, 09 Dec 2014
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MARKET CLOSE: Shares gain as F&P Healthcare at record on weak kiwi, Air NZ fuel costs drop