Market close: Shares gain, led by Fletcher on expected earnings growth

New Zealand shares gained, led by Fletcher Building after the biggest listed company forecast earnings growth of up to 22%, lifting the NZX 50 Index higher. NZ Oil & Gas was the biggest decliner.

The NZX 50 Index rose 30.37 points, or 0.8%, to 3972.97. Within the index, 29 stocks gained, 10 fell and 11 were unchanged. Turnover was a bigger-than-normal $177.5 million, with Fletcher shares accounting for $87.9 million today.

Fletcher Building led gainers, rising 3.7% to a 13-month high of $7.65 after the construction firm flagged operating earnings will be between $560 million and $610 million in the 2013 financial year, up by between 12% and 22% from a year earlier.

The strength of the residential market in Christchurch and Auckland is driving that growth.

"They're very focused on improving the productivity of the business and that's something we expect to occur with other companies," says Shane Solly, head of equities at Mint Asset Management. "These are things people want to hear."

Rural services firm PGG Wrightson gained 3.1% to 33 cents, while gold miner OceanaGold rose 2.6% to $4.18. Tech companies Diligent Board Member Services and Xero rose 2.3% to $4.48 and 1.8% to $6.10, respectively.

Children's clothing chain Pumpkin Patch was unchanged at $1.25 after chief executive Neil Cowie told shareholders Christmas trading is likely to be tough, with retailers continuing to discount their wares.

Other retailers fell in trading today, with outdoor equipment chain Kathmandu down 1.1% to $1.85, Warehouse falling 0.9% to $3.17 and Michael Hill International declining 0.8% to $1.23.

Fisher & Paykel Healthcare, which derives more than half its revenue in US dollars, fell 0.8 % to $2.43 after the New Zealand currency rallied half a US cent.

NZ Oil & Gas was the biggest decliner on the NZX 50, falling 1.1% to 86.5 cents.

A2 Corp, which markets milk products, fell 1.5% to 64 cents after the company told shareholders it is in talks with the stock exchange to shift its listing to the main board from the alternative market.

"With a $400 million market cap it's a reasonably substantial entity in its own right, so it's time to migrate on to the main board," Mr Solly says.

NZAX-listed fast food chain Burger Fuel Worldwide sank 8.9% to $1.12 after reporting a 37% lift in first-half profit on the strength of its growing Middle East sales. The company still has no plans to pay dividends, instead preferring to focus on growing its international business.

Stock exchange operator NZX was unchanged at $1.24 after research firm Morningstar recommended investors steer clear of the $525 million Fonterra Shareholders' Fund float and wait until the units trade before buying them.

The research firm gives a "do not subscribe" recommendation for the fund's initial public offering, saying Fonterra lacks pricing power over its dairy commodities, generates low returns compared to its multinational peers, and investors will not know the price they are paying until after the bookbuild process is completed on November 27.

Shares in miner Glass Earth surged 22% to 33 cents after the NZAX-listed firm gained rights to take over the Neavesville gold and silver prospect currently controlled by Canadian resource developer Eurasian Minerals.

(BusinessDesk)