MARKET CLOSE: Shares rise; Kathmandu gains on buyout hope, Ebos, Nuplex, NZ Refining gain

New Zealand shares rose, led by Kathmandu Holdings on speculation it may be subject to another takeover offer. Ebos Group, Nuplex Industries and New Zealand Refining Co advanced.

The S&P/NZX 50 Index gained 37.03 points, or 0.7 percent, to 5630.54. Within the index, 39 stocks rose, six fell, and five were unchanged. Turnover was $75 million, lighter than usual with several states in Australia on a public holiday.

Kathmandu led the benchmark index higher, gaining 4.3 percent to $1.46. The outdoor goods retailer's board rejected an offer from sporting goods and homeware chain Briscoe Group, saying the cash and scrip offer, which amounted to $1.80 per share undervalued the company. Rod Duke, Briscoe's chief executive and controlling shareholder, may make another bid as he looks to launch across the Tasman. Outside the benchmark index, Briscoe fell 0.4 percent to $2.84.

"There was a broker report out just today that was suggesting Briscoes might come back and have another crack," said Mark Lister, head of private wealth research at Craigs Investment Partners "Which is true - they may well do that. That's giving it a little bit of attention, or reminded people the stock could still be in play."

Wall Street ended the week higher last week, as investors speculated weak data in the US may see the Federal Reserve keep interest rates lower for longer, a boost for equities. Asian markets followed suit, with Japan's Nikkei 225 Index up 1.6 percent in afternoon trading, while Australia's S&P/ASX 200 Index gained 1.9 percent.

"There's certainly positive leads from overseas," Lister said. "There was a very weak jobs report that came out, which on the one hand is a negative because that's a key piece of economic data that didn't look good at all. The market, ironically, might have seen it as positive because they might have seen it as going to keep interest rate rises at bay for some time."

Ebos, the animal and healthcare business, climbed 2.1 percent to $12.90. NZ Refining rose 2.1 percent to $3.47. Nuplex, the resins and chemicals firm, gained 2 percent to $2.58.

Dividend paying stocks, such as energy companies and property investors, rose. Precinct Properties New Zealand gained 1.3 percent to $1.15. Goodman Property Trust increased 1.3 percent to $1.17. Kiwi Property Group climbed 2 percent to $1.295. MightyRiverPower rose 0.6 percent to $2.52. Meridian Energy advanced 0.5 percent to $2.115. Contact Energy gained 0.4 percent to $4.95.

Improving dairy prices, New Zealand's largest export commodity, had also calmed investors' fears about the outlook for the domestic economy, Lister said.

Units in Fonterra Shareholders' Fund, which give holders access to Fonterra Cooperative Group's dividend stream, rose 0.6 percent to $5.28.

Metro Performance Glass, the largest glass manufacturer in New Zealand, was the worst performer on the benchmark index down 2.3 percent to $1.30.

NZX, the stock market operator, declined 1 percent to 97 cents. The value of share trading on New Zealand's stock exchange climbed 23 percent in September, rounding out a quarter when the benchmark S&P/NZX 50 index posted its biggest three-month decline in more than three years. The total value of equity trading rose 22 percent to $3.4 billion last month from September 2014, while the total number of trades climbed 29 percent to 120,305, according to NZX's monthly metrics.

(BusinessDesk)