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Meridian, Goodman, Genesis lead slide

By Jonathan Underhill

Air New Zealand shares fell 2.5 per cent to $1.935 yesterday. Photo / Mark Mitchell
Air New Zealand shares fell 2.5 per cent to $1.935 yesterday. Photo / Mark Mitchell

New Zealand shares extended their slide with little positive news to stem the decline.

The S&P/NZX 50 Index dropped 38.51 points, or 0.5 per cent, to 7,210.73. Within the index, 30 stocks fell, 12 rose and eight were unchanged. Turnover was $197 million.

Investors are waiting for positive company news to reassure them as local index selling, which began on Monday after a Wall St sell-off driven by comments made by US Federal Reserve officials about the likelihood of a US rate increase, continues, said Peter McIntyre, investment adviser at Craigs Investment Partners.

"We're heading into annual general meeting season and a lot of investors and analysts are looking for company outlooks," McIntyre said.

"We had a strong reporting season, now we've got volatility driven from offshore, and there's just a lack of news which is probably going to drive investors to the sideline.

"[That's] unless we start getting some really positive commentary from the AGMs to further confirm company outlooks.

A lot of the market has been driven higher by offshore investors, and they don't like higher interest rates."

Risk aversion and a global rout in bonds have pushed up interest rates, denting the appeal of stock yields.

Meridian Energy dropped 3.3 per cent to $2.77, Goodman Property fell 3 per cent to $1.31, Genesis Energy declined 2.6 per cent to $2.24 and Chorus gave up 1.6 per cent to $3.985.

Air New Zealand fell 2.5 per cent to $1.935. The airline gave its August operating statistics yesterday, and said load factors had fallen on domestic, transtasman and long-haul routes.

"They gave good guidance around their reporting time, saying they're not expecting the same profitability over the next 12 months as they have previously, but certainly the last two operating and statistical performances they've put out have been weaker," McIntyre said.

Skellerup Holdings was the best performer, up 3 per cent to $1.36.

"They're having a strong day on really good volume for them, it's a cyclical stock and with the uptick in the dairy sector after the last three Global Dairy Trade auctions it's looking far brighter," McIntyre said.

Tegel Group rose 1.8 per cent to $1.72 and Sky Network Television gained 1.5 per cent to $4.79.

Outside the main index, Veritas dropped 9.1 per cent to 20c. Salt Funds Management, which manages $1.6 billion of assets, has lifted its stake in the Mad Butcher franchisor.

Turners gained 1.6 per cent to $3.13. The financial services firm, formerly Dorchester Pacific, said pre-tax earnings may rise 14 per cent in the first half, putting it on track for annual profit growth. BusinessDesk

- BusinessDesk

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