NZ stocks: Sky City on a roll in stalled session

Casino operator Sky City hit a record high but elsewhere the sharemarket was subdued yesterday in the absence of takeover action.

The NZSE-40 capital index rose 2.94 points to 2087.41.

Forsyth Barr's Don Turkington said the market was dependent on corporate plays in the likes of Montana, PDL, Sky TV and next week Contact Energy as cornerstone shareholder Edison Mission moves to increase its stake, probably from Wednesday.

"If you look at the overall performance the market is not doing very much," he said.

"We're down about four points this week so the leaders aren't doing much, but selected takeover situations like Richmond, Montana, PDL - that's where all the action is."

Companies are rushing to complete takeover manoeuvres before July 1 when a new code will take effect.

Fletcher Building, which this week said its second half earnings were well up on the first half and announced a new chief executive, was up 4c at $2.36.

Contact was up 3c at $2.99 in anticipation of Edison's buying.

Sky City, under managing director Evan Davies, closed up 20c at a record $10.10. "It really is phenomenal," Dr Turkington said, noting rumours saying it would be included in a Morgan Stanley Capital International index used by fund managers as an investment benchmark.

Among losing stocks Air NZ looked "pretty dreadful", needing a lot of cash to revitalise its Ansett fleet. "That company is desperately in need of some positive news on recapitalisation," Dr Turkington said.

The A shares lost 2c to $1.01 and the Bs dropped 4c to $1.34.

Auckland Airport, now "totally recovered" from a temporary dip when Qantas NZ went out of business, rallied 6c to $3.60.

Affco Holdings rose a cent to 31c, announcing a 90 per cent drop in after tax profits for the half year to March 31.

* The New Zealand dollar remained firm yesterday on the back of a stronger Australian dollar, looking set to head towards 43USc.

At 5pm, the kiwi traded at 42.59c, up from 42.27c, while the aussie traded at 52.72c from 52.48c.

The US dollar remained weak, continuing to provide a boost for the aussie. HSBC noted in its daily analysis that the kiwi was attracting support in its own right with commentators mentioning the interest rate differential, now at 175 basis points on the official rates.

- NZPA