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Hot Topic NBR Focus: GMO
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NZ sharemarket falls back as tax proposals hit property

The New Zealand sharemarket ended flat  as better-than-expected retail sales data and a sharply weaker New Zealand dollar helped offset negative offshore sentiment.Proposed tax changes also impacted negatively on the property sector.The NZX-50 ended

NBR staff
Thu, 21 Jan 2010

The New Zealand sharemarket ended flat  as better-than-expected retail sales data and a sharply weaker New Zealand dollar helped offset negative offshore sentiment.

Proposed tax changes also impacted negatively on the property sector.

The NZX-50 ended down 2 points, or 0.1%, at 3225.289.

"The market is holding up quite well, considering what happened in overseas markets overnight," said Hamilton Hindin Greene broker Grant Williamson.

He noted, however, that volumes remain quite light and said the market was likely to continue "treading water" until there was some clear direction from companies when reporting season begins in the next few weeks.

The New Zealand dollar, which took a tumble overnight, helped bolster exporters such as medical devices maker Fisher & Paykel Healthcare, which ended up 1.5% at $3.35.

Several retail stocks benefited from positive November retail data, which added to the view the economy is recovering.

"Today's retail sales data were stronger than expectations, and suggest that consumers may be starting to come out of their shell," said ANZ senior markets economist Khoon Goh.

Clothing retailer Hallenstein Glasson added 4.4% to $3.35, while discount retailer The Warehouse ended up 0.8% at $3.82.

Mr Williamson said the market was also held up to some extent by the rise of construction company Fletcher Building, which added 1.5% to $8.15. He said the gains may have been on some bargain-hunting as the stock has lost ground in recent sessions.

Property companies such as Kiwi Income Property and ING Property continued to lose ground on jitters over the Tax Working Group's recommendation that the government enact "significant changes" to the tax system, including the possibility of introducing a land tax.

Kiwi Income shed 2.9% to $1.01, while ING Property ended down 1.3% to 76c.

NBR staff
Thu, 21 Jan 2010
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NZ sharemarket falls back as tax proposals hit property
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