NZ stocks: CHH sale pushes market to another closing high

The share market motored to another fresh closing high today as Carter Holt Harvey rallied on news of the better than expected price it secured for the sale of its tissue business.

The benchmark NZSX-50 gross index closed 27.86 points or 1.09 per cent higher at 2575.62, while the NZSX-40 capital index rose 25.18 points or 1.09 per cent to 2327.33.

ASB Securities head of advisory Stephen Wright said it was another good day.

While Carter Holt Harvey was the main news, most stocks, particularly those with good dividend yields, had made gains.

"Anything with a half decent or decent announcement -- you see it reflected in the price," he said.

Carter Holt finished the day 11c higher at 223, after peaking earlier in the day a four-year high of 228.

The wood processor and forester announced yesterday it had sold its tissue business and an associated joint venture to Swedish company Svenska Cellulosa AB for just over $1 billion -- far outstripping market expectations.

But Mr Wright said the sale price was not the only positive for the company at the moment.

"It's got a capital return and announcements regarding its forestry estate so there's going to be further things happening there and that will be enough to keep momentum going in the shorter term.".

Matt Willis of ABN Amro said the stock looked comfortable at the 222 level.

"Once the market digests the impact of that sale, given that it's a one off and they don't get to enjoy the earning streams from that business any more, the stock will start trading on fundamentals," he added.

Market leader Telecom finished a cent lower at 579. Yesterday the Commerce Commission said it had filed High Court proceedings against the company alleging anti-competitive behaviour.

Mr Wright didn't believe there was anything in Telecom's one cent dip today "It's just fluctuating in its present range," he said.

The Warehouse finished 9c lower at 425. "That's a bit of a drift for them.," Mr Wright said.

"It's not likely to go up by any amount until we get some resolution to the Australian problems so it's always going to fluctuate within a range."

Elsewhere, Mr Wright said a number of "old favourites" did well today.

Wood processor Tenon closed up 3c at a 2-1/2 year high of 143. Today is the record date for the company's 62.5 cents per share capital return to shareholders resulting from the sale of much of its forests. "Inevitably you always get a small blip on that," Mr Wright said.

In the energy sector Contact Energy closed up 5c at 533 its highest close since early February, and NGC Holdings was 11c higher at 240.

Other stocks to rise today included: Auckland International Airport up 13c to 650, BayCorp Advantage up 6c 306, Briscoe Group up 3c to 153, Fisher & Paykel Appliances up 6c to 430, Fisher & Paykel Healthcare up 4c to 1174, Fletcher Building up 5c to 442, Freightways up 5c to 223, Independent Newspapers up 5c to 480, Infratil up 7c to 274, Michael Hill up 10c to 530, NZX up 15c to 855, Promina up 14c to 434, Repco up 10c to 310, Sky City up 3c to 443, Steel & Tube up 7c to 385 and Tranz Rail up 4c to 144 .

Among stocks to fall were: GRD down 15c to 205, Mooring Systems down 45c to 375 and TelstraClear down 2c to 532.

Total turnover was worth $105.93 million with $25.91 million of this in Telecom and $20.29 million in Carter Holt Harvey.

There were 77 rises and 27 falls among the 142 stocks traded.

- NZPA