Stockmarket 'disappointingly flat' despite good overseas leads

SkyCity Entertainment Group closed down 2.7 per cent at $4.27. Photo / Dean Purcell

New Zealand shares were flat as Tegel Group Holdings and Z Energy advanced on positive updates, while SkyCity Entertainment Group dropped.

The S&P/NZX50 index rose 3.44 points, or 0.05 per cent, to 6,976.53. Within the index, 24 stocks rose, 20 fell and six were unchanged. Turnover was $155 million.

"The market is disappointingly flat - we had good leads from offshore, pretty much a sea of green from everywhere, but we're only just there," said David Price, broker at Forsyth Barr.

"Volumes are relatively quiet in a lot of stocks, the market itself is not cheap, on a multiple basis it's still very high and some of the stocks don't have the valuation support so they have fallen on very low volumes."

Tegel led the index, up 3.4 per cent to $1.52. At its annual meeting today, the company said it was on track to achieve its product disclosure statement forecast for the full year of $625 million in revenue, up 7.6 per cent on 2016.

The forecast will be updated at the release of the first-half results in mid-December when it also expects to announce its first dividend.

The shares performed well after the May float, hitting a peak of $1.80 in mid-August, but have been mainly falling since which some commentators have blamed on the upcoming November float on the ASX of Australia's largest chicken company, Ingham's Group, which is Tegel's largest competitor domestically.

Z Energy rose 3.2 per cent to $8.03. The Wellington-based service station operator said it has identified $10m to $15m of additional savings from the integration of the Caltex and Z businesses, while the sale of an Auckland retail site for $23m will be used to repay debt. The additional synergy benefits bring the total to be achieved in the 2018 year to between $40m and $45m, it said.

"The feeling towards those synergies is it's probably still conservative, and the divestment was higher than we were picking, so all very positive," Price said.

Ebos Group advanced 1.1 per cent to $17.80. The Christchurch-based company said it had a positive start to 2017, based on its first-quarter performance, which improved even in the face of a Kiwi dollar that reached an 18-month high against its Australian counterpart last month.

SkyCity Entertainment Group was the worst performer, down 2.7 per cent to $4.27. Its shares started falling on Monday in response to the arrest of 18 staff employed by its Australian rival, Crown Resorts, by the Chinese government.

Contact Energy fell 2 per cent to $4.79 while New Zealand Refining Co dropped 1.8 per cent to $2.21.

Genesis Energy was unchanged at $1.98, and has gained 6.2 per cent this year. New Zealand's largest electricity retailer said lower oil prices, increased carbon costs and its "below market" contract with the struggling Tiwai Point aluminium smelter will weigh on earnings this year.

Outside the benchmark index, New Zealand King Salmon shares fell 1.8 per cent to $1.10 in their NZX debut after the fish farming company raised more than $70m to fund its growth and allow existing shareholders to reduce their holdings. The stock first traded at $1.16 on the NZX.

Wynyard Group remains in a trading halt at 21.5c, having been placed in a trading halt on Monday afternoon ahead of a company announcement.