Comvita leads index higher on China deal

Scales Corporation will join the S&P/NZX 50 Index. Photo / Glenn Taylor

New Zealand shares rose, led by Comvita on the back of its plans to take control of its Chinese distribution, while Air New Zealand and Mercury NZ also gained.

The S&P/NZX 50 Index rose 65.73 points, or 0.9 per cent, to 7,491.84. Within the index, 36 stocks rose, 10 were unchanged and five fell. Turnover was $182 million.

Comvita was the best performer on the index, up 6 per cent to $10.60. The New Zealand manuka honey products company plans to acquire 51 per cent of its Chinese distributor in a $30 million all-stock deal that will see the owners of Shenzhen Comvita Natural Food Co lift their holding in Comvita to more than 11 per cent.

Air New Zealand gained 3.3 per cent to $2.35.

"It's creeping back up, people are just maybe buying ahead of the dividend, or they're thinking that tourism numbers are going to stay pretty robust, and that's good for Air New Zealand - once tourists get here, generally they travel around, and their domestic routes are something like three times more profitable than their international flights," said James Smalley, at Hamilton Hindin Greene.

Steel & Tube Holdings will drop out of the S&P/NZX50 benchmark index on September 16, along with rubber goods company Skellerup.

Agribusiness group Scales Corporation and cinema software developer Vista will replace them.

Vista more the doubled its profit in the first half of its financial year due to increased revenue from acquisitions, while Scales saw net profit rise 3 per cent to $33.8m in its first half. Vista rose 2.9 per cent to $6.80 and Scales rose 3.1 per cent to $3.33.

Steel & Tube shares gained 1.4 per cent to $2.22 yesterday, while Skellerup was unchanged at $1.36.

Mercury NZ climbed 2.6 per cent to $3.32, Tower rose 2.6 per cent to $1.37, and Spark New Zealand advanced 2.4 per cent to $3.885.

Contact Energy was the worst performer, down 2.5 per cent to $5.05, while Z Energy dropped 0.5 per cent to $8.30.

Outside the main index, Wynyard Group dropped 4.2 per cent to 23c. It's down 87 per cent this year.