Dec. 10 (BusinessDesk) – New Zealand shares fell as some investors sold shares in one of the world’s best performing equity markets this year. Contact Energy and Chorus paced the decline.
The NZX 50 Index fell 10.75 points, or 0.3 percent, to 4030.77. Within the index, 26 stocks fell, 13 rose and 11 were unchanged. Turnover was about $126 million.
So far this year the index has gained 23 percent, while Australia’s S&P/ASX 200 Index is up 12 percent and America’s Standard & Poor’s 500 Index is up about 13 percent.
“The New Zealand market has had a pretty strong run and some people are asset allocating away from NZ equities,” said David Price, a broker at Forsyth Barr. “There’s an absence of real strong buying interest.” Still, the selloff was a pause and he expected New Zealand stocks to continue to rise.
Contact, the biggest power company on the exchange, fell 2.3 percent to $5.20.
Chorus, the network company spun off from Telecom last year, dropped 2.2 percent to $2.73, a record low. The company’s plunge started last week when it said earnings would be slashed if a draft determination on pricing from the regulator was enforced.
Telecom fell 0.9 percent to $2.265.
Warehouse Group rose 0.3 percent to $3.10 at the close, having declined during trading, after the retailer said it would buy the unprofitable Noel Leeming chain from Gresham Private Equity for $65 million.
Some investors were hoping to see results from its existing refresh strategy for Warehouse’s red sheds before it embarked on an acquisition, Price said.
Fletcher Building, the biggest company on the NZX 50, the highest since early July 2011, amid optimism the rebuild of Christchurch is gathering pace. Steel & Tube Holdings, which sells steel building materials, climbed 1.3 percent to $2.31.
Sanford, the fishing company, fell 3.5 percent to $4.40 after shedding its 14 cent final dividend.
Food manufacturer Goodman Fielder dropped 3.5 percent to 82 cents, the biggest decline on the benchmark index today. OceanaGold fell 3 percent to $3.54. The shares resumed their decline after last week’s surprise announcement that it had raised C$93.3 million selling 30 million shares for C$3.11 apiece in Canada.
PGG Wrightson, the nation’s biggest rural services company, fell 2.7 percent to 36 cents even after dairy giant Fonterra lifted its forecast milk payment to farmers.
Cavalier, the carpet maker and wool scourer, rose 1.8 percent to $1.70. Trade Me Group, the auction website, rose 1.7 percent to $4.21. Insurer Tower gained 1.1 percent to $1.88.