NZ stocks: Sharemarket limps lower, Warehouse eases on sales report

12.50 pm

The sharemarket slid lower today with the recent pattern of very light trading continuing.

The NZSE-40 index dropped 6.59 points to 2033.05 by shortly after 11am on volume of just $15.3 million.

Market leader Telecom fell 4c to 518.

The main feature was a fourth quarter sales report from The Warehouse which showed New Zealand same store sales rose 15.1 per cent.

JP Morgan broker Geoff Brown said New Zealand sales looked strong but slightly at the expense of margins. Australian sales appeared to have been somewhat disrupted by the introduction of GST and would continue to be the focus. The share price fell 2c to 557.

Baycorp was unchanged at 1245 ahead of its merger announcement at 1.30pm with Data Advantage. Some $1.6 million worth of shares were reported traded off-market. Mr Brown said there was speculation both companies would announce special dividends to use up their imputation and franking credits, and that the terms would be more advantageous to Baycorp than earlier reports. Rumoured offer terms of 1.5 Data shares for one Baycorp would value Baycorp at about $13/share while 1.6 would value it at $13.80.

Port of Tauranga rose 5c to 705 after announcing it would return $67 million of surplus capital to shareholders through a pro-rata one-for-eight cancellation of shares. Infratil, which owns 19.9 per cent of Infratil was up 5c to 171.

Genesis Research was also unchanged at 385 after reporting a $1.7 million half year loss. Mr Brown said the loss was slightly bigger than anticipated and may mean profits are further in the future than originally forecast.

Fletcher Building rose 7c to 264.

Independent Newspapers fell 6c to 370 despite news that it appears on the point of settling its industrial dispute with journalists.

Nufarm fell 5c to 350. It announced plans yesterday to delist from the NZSE.

Tranz Rail fell 4c to 413, Westpac NZ fell 25c to 1575 as did fellow Australian bank ANZ, to 2020.

In New York, stocks fell across-the-board in one of the year's most lacklustre sessions, as investors worried that computer price wars will hurt the earnings prospects for chip giant Intel Corp.

The blue-chip Dow Jones industrial average slumped 111.47 points, or 1.06 per cent, to 10,401.31, finishing just shy of its session low.

The Nasdaq Composite Index also weakened, with Intel at the top of the list of the technology-laden market's most heavily traded shares. The Nasdaq fell 32.07 points, or 1.55 per cent, to 2,034.26.

- NZPA