NZ stocks: Competition hits F&P Healthcare

Fears of increased competition in the healthcare field saw market darling Fisher & Paykel plummet on an easing New Zealand sharemarket yesterday.

F&P Healthcare lost 80c, falling to $15.95, after news that a United States company, Innomed Technology, was poised to mount an offensive in the respiratory healthcare market with a new sleep apnoea treatment.

"The effect that that is going to have on market share for Fisher & Paykel Healthcare is a concern," Forsyth Barr broker Suzanne Kinnaird said.

F&P Appliances, which holds a 20 per cent stake in its sister company, also bore some of the brunt, falling 50c to $10.20 despite news that it had appointed a Japanese distributor to market its high-margin, two-compartment dishwashers.

By the session's close, the sharemarket had generated a moderate turnover of $78.4 million.

But the NZSE-40 capital index fell 12 points to 2101.51, losing more than half a per cent.

"That really came on the back of a weaker close in the offshore markets," said Kerry Porter, assistant director at Macquaries Equities.

The index was dragged down by market leader Telecom, which lost 9c to $5.29 on turnover worth $17.4 million.

Brokers said profit-taking was the likely cause.

Carter Holt Harvey was the star of yesterday's trading - six million shares worth $11.5 million changed hands and the share price rose 5c to $1.88.

The forest products company, which produced a mediocre but better-than-expected fourth quarter result, gained 5.7 per cent and hit a 10-month high of $1.92 after Tuesday's market close.

Analysts said that while Carter's sales returns remained poor, last month's quarter profit of $25 million beat forecasts and all units were trading profitably.

"The market is taking some comfort in that and we did see good two-way interest in the stock going throughout the whole day," said Mr Porter.

The morning's trading was boosted by $20 million worth of offmarket trades in leading Australian stocks including Lion Nathan, Coles Myer, ANZ, AMP, Telstra, Westpac and Amcor.

Lion Nathan rose 2c to $5.80, AMP was up 50c to $23 and DB Group continued its very strong run, rising 5c to $6.50 despite the poor summer eating into sales and profits.

Casino company Sky City Entertainment Group touched $5.95 - its lowest level since a share split in November - and closed down 9c at $6.05 on persistent worries about its troubled 50.2 per cent-owned subsidiary Force Corp.

Force has a quarter share in a joint venture Argentinian cinema operation, and losses associated with the venture have required a recapitalisation, which is being backed by Sky.

"We don't have any great concern with it because it's only 5 per cent of their [Sky City's] assets. However, it's proving to be a poor decision and too many of them can really affect a company," Ms Kinnaird said.

Retailer Briscoecame within 4c of its year high, climbing 4c to $1.69. Brokers said the market was anticipating good results when the company announced its figures to the end of this month.

Rival retailer The Warehouse had a less profitable day, falling 10c to $6.65.

Brokers said the market felt no impact of yesterday's Reserve Bank decision to leave interest rates unchanged.

The bank gave little indication whether it would push rates up at the next review on March 20 but Mr Porter said he was not expecting any movement for at least another three to six months.

"The Reserve Bank's saying there's two conflicting forces ... business conditions have been pretty good, retailing numbers have been strong ... so the domestic economy is remaining pretty robust, [but the bank is] still concerned about the global economy."

That was translating in the sharemarket with some profit-taking in good performers this year such as Telecom.

Falls outnumbered rises 48 to 39 on the 144 stocks traded.

The NZSE-10 capital index followed the top 40's slide, falling nine points to 950.46.

But the NZSCI small business index bucked the trend, gaining 14.71 points to 5866.08.

- AGENCIES