NZ shares fall as Asia-Pacific equities falter, doubts over Europe

BUSINESSDESK: New Zealand shares followed equity markets downward across the region as fears of Europe’s sovereign debt crisis re-emerging sapped investors’ appetite for bigger returns.

Falls were led by breathing respirator maker Fisher & Paykel Healthcare.

The NZX 50 Index was down 9.72 points, or 0.3%, to 3465.39. Within the index, 30 stocks fell, 13 gained and seven were unchanged.

Turnover was $111 million.

Stock markets across Asia-Pacific followed Wall Street and European equities lower after the prospect of ballooning Spanish government debt sparked fears the euro-zone may have to bail-out more of its members if it is to survive its sovereign debt crisis.

Australia’s S&P/ASX 200 index fell 0.7% to 4260.4 in afternoon trading, while Japan’s Nikkei 225 index was down 0.8% to 9461.28 and Hong Kong’s Hang Seng fell 1.2% to 20,116.3.

F&P Healthcare, which attracts more than half of its revenue in US dollars, was the biggest decliner, falling 5.6% to a four-week low $2.20.

"They have been completely beaten up,” said Mark Lister, head of private wealth research at Craigs Investment Partners.

“A couple of brokers might have had some negative reports out” on the stock, he said.

Fletcher Building, the country’s biggest listed construction company, fell 2% to $6.02, and is near a three-month low.

Mr Lister said "of all the big stocks it is the one that is the most exposed to the economy”.

“When you get a day with negative offshore sentiment it is going to be more sensitive,” he said.

“There are continuous concerns surrounding the building sector and Australia.”

Hallenstein Glasson dropped 3% to $3.92 after the clothing chain retailer shed its first-half dividend of 14.5 cents per share.

Other retailers struggled after the New Zealand Institute of Economic Research’s quarterly survey of business opinion showed the sector is still struggling with tepid household demand.

The biggest listed retailer Warehouse declined 1.5% to $2.59, while outdoor equipment chain Kathmandu dropped 2.4% to $1.60 and children’s clothing chain Pumpkin Patch declined 1.7% to $1.13.

PGG Wrightson was the biggest gainer on the day, up 2.7% to 38 cents, while fellow South Island-based firm, Heartland New Zealand, climbed 2.1% to 49 cents.

Shares in Ecoya gained 2.2% to 95 cents after the scented candle and beauty products maker attracted $2 million of new investment from Pie Funds and Milford Asset Management.

Mr Lister said the company is “generating real interest from institutional investors” and has “a good track record of building a strong brand”.

Postie Plus gained 8.7% to 25 cents after the clothing retailer said it will sell its Babycity brand for between $4m and $5m.

The deal needs shareholder approval as the price is more than half the company’s market capitalisation.