NZ stocks: Auckland Airport takes off on quiet market

12.00 pm

The fate of Auckland Airport provided high interest on an otherwise quiet sharemarket this morning.

"It's pretty quiet, typical Monday. The main attention is focused on three stocks this morning," said David Price of Credit Suisse First Boston.

These were Sky City, Fletcher Forest and Auckland Airport, which have all been in the news over the last few days.

Auckland Airport was continuing its "strong run" following comments from Auckland mayor John Banks that the Auckland City Council could sell its shareholding in the airport, Mr Price said.

The talk has helped fuel a 50c rise in the stock in a week, after it initially plummeted in the wake of the September 11 attacks and Air New Zealand's troubles.

"There's obviously talk about the council selling down their holding, there's obviously people looking at the possibility of placing it with institutions and that would be (positive) because they would probably have to pay a bit of a premium," another broker Ken Lister, of Forsyth Barr, said.

Auckland Airport shares were up 11c at 371 this morning and had gone as high as 382.

At 11am the NZSE-40 capital index was up 6.75 points to 1988.39 on total turnover of $38.6 million.

Other stocks providing a focus for the market included Fletcher Forests preference shares, up 2c to 27 after a weekend article about the possible partnership deals being done over the ownership of the Central North Island Forests Partnership.

Sky City was also proving a market favourite, rising 15c to 1270. Investors have shown their approval since the casino company announced a two-for-one share split last week, effective November 16.

Sky City has been a stand out sharemarket performer over the past year, and analysts say increased liquidity and a drop back below the psychologically significant $10 barrier after the share split will further boost its performance.

"Economic value doesn't change in a share when they have a split, but the stock price tends to run after a company's announced it," said Mr Price.

Other stocks to move included Baycorp down 5c to 1180, takeover target Contact Energy up 2c to 419, and another takeover target Frucor down 1c to 242. The Warehouse recovered from early weakness to be square at 670.

Market leader Telecom fell 4c to 458.

Mr Price expected trading to be quiet today and said tomorrow would be even worse as Melbourne Cup day swung into action, closing Victoria for the day and Sydney for half a day.

So far there have been 41 rises and 23 falls on 108 stocks traded.

- NZPA