Article – BusinessDesk
Oct. 6 (BusinessDesk) – New Zealand shares rose after agreement was reached on the Trans Pacific Partnership deal. Xero, SkyCity Entertainment Group and Fletcher Building gained.
MARKET CLOSE: NZ shares rise on TPP; SkyCity, Xero, Fletcher advance
By Suze Metherell
Oct. 6 (BusinessDesk) – New Zealand shares rose after agreement was reached on the Trans Pacific Partnership deal. Xero, SkyCity Entertainment Group and Fletcher Building gained.
The S&P/NZX 50 Index rose 37.57 points, or 0.7 percent, to 5668.11. Within the index, 30 stocks rose, 11 fell or nine were unchanged. Turnover was $113 million.
Overnight 12 Pacific Rim nations reached a deal on the controversial TTP, which covers 40 percent of the global economy and ending more than five years of negotiations to create the largest trade and investment pact since the Uruguay Round of the GATT trade agreement 20 years ago. Investors took the sealing of the deal as a confidence boost, and adopted a risk on attitude.
Xero, the cloud-based accounting software firm, gained 2 percent to $15.30. The company is forgoing profit to fund its US push where it hopes to capture the small-to-medium sized business market.
“A bit more risk-on trading seems to be what we’re seeing today,” said James Smalley, director at Hamilton Hindin Greene. “The markets been worried about economic growth and maybe with that TTP deal sentiment has turned to a positive again, people are more looking for bargains. People are more risk on looking for bargains than protecting capital type scenarios.”
“Xero is the bellwether for how the market is feeling,” Smalley said.
Adding to investors’ confidence, weaker data in the US raised speculation the Federal Reserve keep interest rates lower for longer.
“It was ironically weaker than expected job data in the US that maybe pushed out rates cuts and the market gets excited,” Smalley said. “Investors are looking for some beaten down stocks, for example Fletcher Building well that was a three-and-a-half year lows before. It’s definitely a bit of bargain hunting coming out of the woodwork.”
SkyCity, the casino operator, led the benchmark index higher advancing 3.1 percent to $3.94 having declined some 9.4 percent over the past three months. Fletcher, the construction and building supplies firm, climbed 2.9 percent to $7.20 but has dropped some 14 percent over the past six months.
Units in Fonterra Shareholders’ Fund, which give holders access to Fonterra Cooperative Group’s dividend stream, declined 1.1 percent, or 6 cents, to $5.22. The fund shed rights to its final 15 cents per share dividend today.
Orion Health Group rose 0.6 percent to $3.46, paring an intraday jump of 9 percent after the healthcare system software developer said it was part of a group that won a US Department of Defense contract to help modernise the department’s healthcare data system.
Contact Energy, the energy generator and retailer, was the worst performer on the benchmark down 1.8 percent to $4.86. MightyRiverPower declined 1.2 percent to $2.49.
Outside the benchmark index, Mercer Group climbed 18 percent to 6 cents. The stainless steel fabricator and manufacturer has agreed to sell its unprofitable medical division for $2.03 million, kicking off an asset sale programme signalled in August when the company wrote off $6 million from the value of goodwill, assets and inventory
(BusinessDesk)
Content Sourced from scoop.co.nz
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