Market close: shares rise – MRP up 4.8% from IPO, Tower gains

New Zealand shares extended this year's 14 percent gain on the NZX 50 Index, with Tower leading the advance after completing an asset selldown. Fletcher Building, the biggest company on the index, paced gainers and MightyRiverPower rose on its debut.

The NZX 50 Index rose 13.44 points, or 0.3 percent, to 4652.77. Within the index, 21 stocks rose, 16 fell and 13 were unchanged. Turnover was $142 million.

Turnover was overshadowed by trading in MRP, valued at $167 million, or 62.6 million shares changing hands. The shares closed at $2.62 compared to an initial public offering price of $2.50.

Tower gained 5.3 percent to $1.80 after Fidelity Life Assurance acquired most of Tower's life insurance business for a total "aggregate" value to Tower on the sale of $189 million, including the release of capital. Guinness Peat Group fell 1.9 percent to 53 cents.

Fletcher rose 2.2 percent to $8.66. Manufacturer Skellerup gained 1.5 percent to $1.38. Of the two high-flying tech companies, Xero rose 2.6 percent to $13.75 and Diligent Board Member Services was up about 2 percent to $7.30.

The NZX 50 has reached record highs this month and key benchmark indexes overseas have charted new ground, including the Standard & Poor's 500 Index hitting an all-time high.

Across the Tasman, the S&P/ASX 200 Index is near its highest in almost five years.

"Prices have run up in expectation of growth in underlying earnings," says Angus Gluskie, chief investment officer at White Funds Management in Sydney. "The next phase will be to see whether earnings are delivered."

Warehouse Group gained 0.2 percent to $4.39 after the biggest listed retailer reported a 6.2 percent gain in third-quarter sales at its Red and Blue sheds. Including its new Noel Leeming and Torpedo7 acquisitions, the retailer had continuing sales of $557.1 million in the three months ended April 28.

TrustPower gained 1.3 percent to $7.55 after reporting a 6 percent fall in underlying earnings to $127.3 million as it lost customers and faced thinner margins. Still, the electricity generator and retailer paid a final dividend of 20 cents per share, keeping the total payout unchanged at 40 cents.

Air New Zealand was unchanged at $1.50 after the national carrier tried to pull out of a settlement with the Commerce Commission over the long-running air cargo cartel case at its penalty hearing.

The national carrier claims the withdrawal of a key piece of evidence has changed the game and wants to resume talks with the anti-trust regulator, having been on the cusp of cutting a settlement.

Dual-listed Westpac Banking Group fell 0.9 percent to $39.80 on the NZX after its BT Funds Management unit said it would spin off management of $650 million of equities to outgoing equity and property managers Paul Harrison and Matthew Goodson, who have set up a new firm, Salt Funds Management.

Kathmandu, the outdoor equipment chain, fell 0.7 percent to $2.90. Sky Network Television declined 1.8 percent to $5.46. Telecom fell 0.4 percent to $2.685.

(BusinessDesk)