Tamsyn Parker 's Opinion

Tamsyn Parker is the NZ Herald's Money Editor

Stock Takes: Ups and down on the NZX

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It's been a roller coaster week for the New Zealand share market. The NZX 50 fell more than 1 per cent on Tuesday as the Chinese stockmarket fell to its lowest level in four years amid fears of a credit squeeze slowing its economy.

The fall brought the NZX back to its lowest point since March 6 and wiped 7.6 per cent off the market since its May 13 peak.

But on Wednesday it bounced back as China's People's Bank moved to reassure investors, and the NZX 50 gained 1.7 per cent making up for all the losses of the previous day plus more.

It could be a turning point for the market to start heading back up again but most players expect volatility to remain part of the picture for some time to come.

The August reporting season, which takes in companies with a June 30 balance date, may be the next big guiding point for where local companies are headed.

The NZX 50 closed up 0.53 per cent on 4416.96 yesterday.

Aussies bail out

A broker's report on who has bought and sold shares in Mighty River Power in the past month reveals it has been mainly Australian investors who have sold shares.

The biggest seller was an Australian nominee account for HSBC bank. It was the fourth largest shareholder on May 24 with 0.79 per cent but by last Friday, it had reduced its stake by more than half to 0.356 per cent and is now the 10th largest.

Nominees accounts for BNP Paribas, JP Morgan Australia, CS Fourth Nominees (an account for Credit Suisse Equities Australia) have also all sold shares.

All are ranked within the top 25 largest shareholders for the power company.

But some New Zealand brokers have also been in the mix. Two custodian accounts for Forsyth Barr have reduced stakes as has First NZ Capital Securities, although other custodian accounts for Forsyth Barr and First NZ have also been buyers.

Next Friday, the NZX conducts its monthly reweighting of the indices. A week after that investors will find out if Mighty River has reached the top 10 index.

Fund managers will then have to decide whether to buy more shares in the company. Shares in Mighty River have recovered some ground this week after hitting a $2.20 low last Friday. Yesterday they closed on $2.24.

Another blow

Chorus shares took another hit yesterday as the Commerce Commission set out how much each of the 26 telecommunication providers will have to pay towards the Telecommunications Development Levy for 2011/12, which replaces the old Telecommunication Service Obligation that Telecom operated under.

Chorus will have to pay $6.4 million - about 13 per cent of the total cost.

The company's shares closed down 2c yesterday at $2.28.

Shares in the company have performed poorly since February after being hit by regulatory announcements.

Chorus listed at $2.94 in November 2011 after splitting from Telecom but it seems unlikely it will recover that ground any time soon.

Sky buy

Sky Television's share price fall after it lost the rights to show English Premier League soccer was a buying opportunity for at least one Aussie fund manager.

BNP Paribas Investment Partners (Australia) - the Australian asset management arm of the big French bank, bought a 5.48 per cent stake on June 20 - the day after the soccer announcement.

The move makes it the fourth largest owner of Sky TV shares behind Australian fund manager JCP Investment Partners (9.11 per cent), New Zealand's Accident Compensation Corporation (7.33 per cent) and Hyperion Asset Management (6.18 per cent) also from Australia.

When Rupert Murdoch's News Corp sold its 43.6 per cent stake in March it was seen as a chance for ownership of Sky to come back into New Zealand hands.

But Bloomberg data reveals the Aussies are still the largest shareholders by region with 54.39 per cent while only 22.84 per cent is held by New Zealanders - one third of which is the ACC stake.

A further 10.8 per cent is held by investors from Britain and 9.35 per cent is held by American investors.

Sky TV shares plummeted from $5.70 to $4.96 after the soccer loss, but have since recovered about half of that ground. Yesterday they closed up 1c at $5.36.

Moa money

The Business Bakery and Pioneer Capital - the companies behind the brewer Moa Group - supported the share price when it fell below $1.25, in line with undertakings given in the offer documents, says chairman Geoff Ross.

In its documents, Moa said that under the Takeovers Code, the Business Bakery and Pioneer may each buy up to 5 per cent of the company's shares within six months of last November's offer.

"The Business Bakery and Pioneer Capital have each advised that their intention is to commit $500,000 each to acquire shares post listing, in the event the shares trade below the offer price," the documents said.

Ross said The Business Bakery and Pioneer bought stock in the first six months, up until it reached the "black out zone" which prevents insiders trading before a company's result.

"We did when we could," Ross said.

Shares in Moa were offered to investors at $1.25, and hit $1.34 on listing on the first day. The shares ducked below the offer price in early March, and hit a low point of $1.10 on June 17. They closed yesterday at $1.14.

Gender debate

Australian stock exchange operator the ASX is taking concerns about gender balance in its management to another level. ASX chief Elmer Funke Kupper told the Australian Financial Review this week that from August it will start reporting on women in leadership down five levels of seniority.

The ASX was one of 14 corporate and government leaders in Australia to sign up to tougher gender-reporting obligations last week.

But don't expect the New Zealand bourse to be following suit. A spokeswoman for the NZX said it had a very flat reporting structure compared to the ASX, and already had a committed leadership role in promoting diversity in New Zealand.

"NZX itself has 185 staff and a very flat reporting structure, compared with ASX's more than 500 staff. More than 50 per cent of our staff are women and of the CEO's direct reports, four out of 10 are women. We have two women on our board."

NZX chairman Andrew Harmos is a member of the 25 per cent Group, set up to help get more women directors on to boards, and the NZX is a founding funder of the Diverse NZ project.

The NZX followed the ASX this year in changing its reporting rules so listed companies have to disclose the gender breakdown for their boards and senior officers.

- NZ Herald

Tamsyn Parker

Tamsyn Parker is the NZ Herald's Money Editor

Tamsyn Parker is the NZ Herald's Money Editor. A business journalist for ten years, she has worked in the UK and NZ for the New Zealand Herald, the National Business Review and a specialist publication on investment products for financial advisors. She is passionate about helping readers learn more about to make their money work for them.

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