NZ stocks: Shares dip on thin turnover

12.00pm

New Zealand's benchmark share indices eased slightly in morning trade today on thin turnover.

At 11.30am the NZSX-50 gross index was 4.6 points or 0.21 per cent lower at 2227.15, while the NZSX-40 capital index was 5.2 points or 0.24 per cent lower at 2144.12.

Turnover by 11.30am was $14.6 million. Market leader Telecom was 2c lower at 500.

Direct Broking's Ken Allen said trade this morning was very quiet. "There's no great movers across the board".

"There's a bit of trading in Fletcher Forests, because the market seems to view the sale of the forest is not a done deal and there's a bit of water to pass under the bridge before anything actually goes ahead."

Fletcher Forests said yesterday it had signed a letter of intent to sell its entire 106,000ha estate to Oregon timber management company The Campbell Group. The price of $685 million is well below the book value of $728 million.

The deal would probably result in a capital return to shareholders of $1 per share, or $558 million which includes $140 million of proceeds from earlier sales.

Fletcher Forests' shares were 5c lower at 119 at 11.30am today after rising 9c yesterday to 124.

"People are taking the profit," Mr Allen said.

As for the price Fletcher was looking to extract from the Campbell Group for the assets, "people are saying it's irrelevant because it might not go ahead", Mr Allen said.

"There's a view from some people that it may shake another buyer out of the wings, but that's not a prevalent view."

Otherwise, Mr Allen said this morning's muted start was partly due to "a lot of focus on the fed meeting". Later today the US Federal Reserve is to hold a policy meeting. "That's keeping a lot of people bunkered down," Mr Allen said.

Meanwhile on overseas markets yesterday, US stocks declined in quiet trading as mixed economic data caused some investors to question the strength of the current economic recovery. Britain's top shares bounced back from a four-day losing streak, as Vodafone led telecoms stocks up, and European equities ended slightly higher. Japan's sharemarket was closed yesterday for a public holiday.

Back in New Zealand, among the stocks to move in early trade by 11.30am were: Air NZ down a cent to 55, AMP down 10c to 755, Auckland International Airport up 8c to 655, Briscoe Group up a cent to 180, Carter Holt Harvey up a cent to 169, Contact Energy down 4c to 485, Dorchester Pacific Group up 2c to 202, Fisher & Paykel Appliances up 4c to 1459, Fisher & Paykel Healthcare down 5c to 1245, Fletcher Building up a cent to 413, Hirequip up 2c to 87, Mooring Systems up 8c to 170, NZX down 5c to 455, Promina down 6c to 334, Rubicon down 2c to 73, Ryman Healthcare up 4c to 194, Sanford down 5c to 520, Sky TV down 2c to 485, Software of Excellence up 2c to 107, Steel & Tube down a cent to 364, Tourism Holdings Ltd down a cent to 138, and Turners Auctions up 4c to 390 .

There were 24 rises and 32 falls on 108 stocks traded.

- NZPA