NZ stocks: Heavyweights pull sharemarket down

6.16pm

Heavyweight stocks dragged the broader sharemarket down today, with Telecom falling away and Contact Energy's rising profit failing to impress investors.

The benchmark NZSX-50 index slid for the second day in a row, losing 4.22 points to 2923.46, while the NZSX-All capital index fell 1.45 points to 968.86.

Top stock Telecom lost 7c to 599 on turnover worth $22.5 million, as it again struggled to maintain a price above the $6 mark.

Matt Willis of ABN Amro Craigs said $6 seems to be a threshold the telco giant had trouble sustaining.

"But valuation-wise it should certainly be able to," he said, adding today's fall was probably related to the strong New Zealand dollar, which today hit an intra-day high of just over US71c.

Fellow blue-chip stock, Contact Energy, slipped 1c to 626 despite announcing a 22 per cent rise in its full year net profit. The electricity firm posted a September year profit of $144.04 million, up from $118.26m the previous year.

The company also announced a fully imputed final dividend of 8 cents per share bringing its total dividend for the year to 25cps, up from 23cps last year.

Hamilton Hindin Greene broker Grant Williamson said Contact's result was solid and in line with investors' expectations.

"But there's been very little interest in the shares," Mr Williamson said.

"They (investors) have got no more reason to buy that stock at the moment, but looking ahead it's a good option," he told NZPA.

Rounding out the top three stocks, Carter Holt Harvey was up 1c at 216. On Friday the forestry company announced a A$85 million ($95 million) off-market takeover bid for Australian packaging company Wadepack.

Total market turnover was worth $74.3 million, made up of 51 rises and 56 falls among the 168 stocks traded.

Nuplex said today at a special shareholders meeting its sales revenue would grow around 70 per cent and ebitda (earnings before interest, tax, depreciation and amortisation) by more than 40 per cent as a result of buying the coatings resins business of Akzo Nobel in the Netherlands.

Nuplex shareholders are being offered the chance to buy shares at a 3.5 per cent discount to raise up to $15 million to go towards the $202m purchase.

Meanwhile, investors reacted positively to Auckland International Airport's (AIA) annual meeting today, when it revealed an October quarter net profit of $34.7m, up 23 per cent on the previous same period. AIA was up 12c, or 1.6 per cent, to 760.

ING Property Trust was unchanged at 115, after it today posted an $11.08 million profit for the September half year, up from $1.8 million for the same period last year.

Trust chairman Michael Smith also said previously announced merger discussions were continuing with Urbus Properties, which was down 1c at 105.

Childrens' clothing retailer Pumpkin Patch was unchanged at 230, following its annual general meeting where sharehodlers were told the company expected to beat its forecast annual net profit of $15.3 million.

Other stocks on the move today included: Williams & Kettle up 15c at 340, The Warehouse up 1c at 375, Fletcher Building up 9c at 606 and Michael Hill Jeweller up 5c at 835.

- NZPA