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MARKET CLOSE: Shares rise, led by Tower, Fletcher

NZX50 Index rose 0.02 points, or 0.874%, to 5795.855.

Suze Metherell
Tue, 26 May 2015

New Zealand shares rose, led by Tower, after the general insurer lifted its dividend. Dual-listed stocks such as Fletcher Building and A2 Milk Co advanced as stocks on the ASX gained.

The NZX 50 Index rose 0.02 points, or 0.874%, to 5795.855. Within the index, 20 stocks rose, 27 fell and three were unchanged. Turnover was $104 million.

Tower led the benchmark index higher, rising 4.3% to $2.20 after the general insurer hiked its interim dividend and confirmed an on-market share buyback, while reporting a 36% gain in first-half earnings driven by rising premiums and fewer claims.

"What investors were very happy about was the increase in dividend," said Grant Williamson, director at Hamilton Hindin Greene. "The insurers are in a pretty good spot now, with premiums much higher, as most of us are aware. Barring any major catastrophes, they could be in a pretty good environment."

Across the Tasman, Australia's ASX/S&P 200 Index climbed 0.9% amid news reports that Australia's third-largest iron ore miner, Fortescue Metals, is in talks with a Chinese investor interested in taking a strategic stake. The good sentiment flowed through to dual-listed stocks, Mr Williamson said. Fletcher, the construction and building supplies firm, advanced 0.8% to $8.64. A2 Milk, the milk marketing company, gained 2% to 52c.

"Australia's quite firm and that's helped us today," Mr Williamson said.

Orion Health fell 0.4% to $4.83. The healthcare system software developer reported a $60.8 million loss in the year ended March 31, in line with its strategy to increase revenues before becoming profitable. Annualised revenue growth beat its prospectus forecast.

SkyCity Entertainment Group declined 0.9% to $4.35. The casino operator has lifted the minimum it will invest in the Auckland International Convention Centre to $430 million and said total costs including land may be $450-470 million.

Contact Energy fell 1.3% to $6.10, back from yesterday's 11% jump. The energy generator and retailer said it had ditched plans for now to invest in geothermal schemes offshore and will increase returns to shareholders, including a special dividend of 50c a share, payable June 23, and a new ordinary dividend payout ratio of 100% of underlying earnings after tax.

Outside the benchmark index, Scott Technology was unchanged at $1.37 after it confirmed it laid off 13 workers as the industrial automation firm looks to cut staff numbers at its Christchurch plant after taking on extra employees during a bumper year.

Green Cross Health dropped 3.2% to $2.41. The company, formerly known as PharmacyBrands, posted a 4.1% decline in annual profit to $14.4 million as its staff costs increased. Sales rose 25% to $322.4 million, while cost of sales rose 15% to $168 million.

(BusinessDesk)

Suze Metherell
Tue, 26 May 2015
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MARKET CLOSE: Shares rise, led by Tower, Fletcher
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