Flood of ex-divs puts index under water

Auckland Airport shares were down 2.6 per cent yesterday at $4.88. Photo / Richard Robinson

New Zealand shares fell yesterday, dragged down by companies shedding rights to their dividends including Genesis Energy, Auckland International Airport, Ebos Group and Skellerup Holdings. The benchmark index ended the quarter down 3.5 per cent.

The S&P/NZX 50 Index fell 19.06 points, or 0.3 per cent, to 5593.36. Within the benchmark index, 28 stocks fell, 13 rose and nine were unchanged. Turnover was a bigger-than-usual $198 million, ending trading in the quarter.

New Zealand stocks went against the trend in trading yesterday, with stocks across Asia following upbeat Northern Hemisphere sessions.

Genesis led the benchmark index lower, down 5.9 per cent, or 11.5c, to $1.83 as the government-controlled energy provider gave up rights to its final dividend of 8c a share. Auckland Airport, the nation's busiest gateway, declined 2.6 per cent, or 13c, to $4.88 as it shed rights to its 7.3c final dividend. Skellerup, the industrial rubber firm, fell 4.4 per cent, or 6c, to $1.29 as it shed rights to its 5.5c final dividend.

Ebos, the animal and healthcare products firm, slipped 0.2 per cent, or 2c, to $12.46 as it gave up rights to its final 25c dividend, but was the best performer in the quarter, up 22 per cent.

Sky Network Television, the dominant pay-TV provider, fell 2.1 per cent to $4.65 and was the worst performer on the benchmark index in the quarter, down 25 per cent.

The flood of stocks going ex-dividend "was a reflection of the market in a lot of respects", said Rickey Ward, NZ equity manager at JBWere. "Also at the end of the month and quarter markets tend to go into a bit of a slowdown period anyway."

Trading in the quarter was marked by volatile markets as investors weighed the outlook for the US Federal Reserve to hike rates for the first time in a decade, while nervousness about China's growth outlook has spooked traders from equities as an asset class. "People are speculating around two events - one was 'would the Fed tighten in late September?'," Ward said. "Then you had China come out and start to show signs of a slowdown and that created market volatility. We've had confirmation of both of those events now, so the market should settle down a bit more."

Z Energy was unchanged at a record $6.63, after requesting a trading halt after close on Tuesday, ahead of a bookbuild where Infratil would sell its 20 per cent cornerstone stake for between $6 and $6.20 via a private placement. The New Zealand Superannuation Fund also sold 9.73 per cent into the offer. Infratil, the infrastructure investor, rose 0.7 per cent to $3.06.

"The company provided guidance a week or so ago and the share price was trading at $5.80, and a week and a half or so later it's at $6.60 and they do a placement - it doesn't look right," Ward said.

Steel & Tube Holdings was the best performer on the benchmark index, up 1.9 per cent to $2.67.

Outside the benchmark index, Hallenstein Glasson was unchanged at $3.51. The clothing chain lifted its full-year dividend by 8.8 per cent while reporting a 22 per cent jump in profit to $17.4 million but warned intense retail competition was eroding margins.