Nov. 12 (BusinessDesk) - New Zealand shares rose, nudging the NZX 50 Index back toward the five-year high charted last month, as Australian interest drove Xero to a record and Fletcher Building gained after agreeing to buy a laminated panels business in India.
The NZX 50 rose 26.07 points, or 0.7 percent, to 3983.99. Within the index, 24 stocks rose, 13 fell and 13 were unchanged. Turnover was $78.7 million.
Xero, the cloud-based accounting services company that dual listed on the ASX last week, rose 8.6 percent to $6.30, giving it a market value of $622. That’s even before the fast-growth company, which listed on the NZX in June 2007, has turned a profit. It has gained 110 percent this year.
Listing on the ASX “opens up more buying in the stock – that’s what we’ve seen,” said Grant Williamson, a director at Hamilton Hindin Greene. “Investors are excited” by the company’s prospects though they should be “a little bit cautious at these sorts of levels.”
Fletcher Building, the biggest construction and building products company on the NZX 50, rose 3.3 percent to $7.48 after its local affiliate, Formica Laminates (India) Private, agreed to buy the laminates manufacturing business of listed Indian manufacturer Well Pack Papers & Containers in the Indian state of Gujurat for 365 million rupees ($8.2 million).
“It highlights the potential of the Indian market for that division of Fletcher,” Williamson said.
Contact Energy, the biggest power company on the NZX , fell 2.6 percent to $5.21 after its controlling shareholder, Australia’s Origin Energy, warned last week that regulatory and pricing decisions would cut underlying profit as much as 10 percent this year.
Among smaller stocks, Genesis Research and Development was halted from trading at 1.8 cents and told the ASX it may not have enough funds to keep operating without a loan or more support from shareholders.
Telecom, the biggest phone company on the NZX 50, rose 1 percent to $2.435, and Chorus, the networks company spun off from Telecom last year, rose 0.9 percent to $3.27. Chorus has gained 3.9 percent this year.
Australia & New Zealand banking Group fell 1.8 percent to $31.34 after shedding its 79 cents a share final dividend. Westpac Banking Corp, the other Australian bank that trades on the NZX, rose about 1 percent to $33.40.
Retailer Warehouse Group rose 0.3 percent to $3.19 and Fisher & Paykel Healthcare climbed 1.2 percent to $2.46.