New Zealand shares were mixed, with Comvita bouncing off yesterday's lows and Z Energy up, while Tegel Group Holdings and Auckland International Airport fell.

The S&P/NZX50 Index dropped 3.69 points, or 0.05 per cent, to 7,064.16. Within the index, 21 stocks rose, 20 fell and nine were unchanged. Turnover was $114.9 million.

"It just seems to be most stocks, in the absence of news, are kind of flat, or every week it's one's turn for bargain hunters to think 'this looks a bit cheap' and bid it up," said James Smalley, director at Hamilton Hindin Greene. "Around December 15, that's when we saw the index move up north of 7,000 again, that's people who may have gone to cash starting to re-position or put that money back in the market. Yes, interest rates have bottomed, but they're not going through the roof, and there's a bit of an opportunity cost having cash at 2 per cent at the moment. That's a theme leading up to reporting season."

Comvita was the best performer, bouncing 7.5 per cent to $6.99, having dropped 17 per cent yesterday after the manuka honey products maker warned annual earnings will tumble by about two-thirds as the nation's unseasonably wet and windy weather saps the honey harvest and slow sales via China's informal trading channels.


"We had a couple of hundred thousand through yesterday, it's at around 95,000 at the moment - I guess just a couple of profit takers rolling through," Smalley said. "It wasn't like something had occurred to affect product margins permanently, it was just a lack of product. The nature of their business is they're always going to be subject to climatic issues, maybe buyers are looking at longer-term prospects for that sector of the market, good demand from middle-class Chinese consumers."

Vector rose 2.2 per cent to $3.26 while Arvida Group gained 1.5 per cent to $1.37.

Z Energy gained 0.8 per cent to $7.50. The company may review its interim distribution policy after reducing debt levels three to four quarters ahead of schedule following its acquisition of Chevron New Zealand's Caltex and Challenge! brands.

"Their free cash flow has allowed them to deleverage a lot quicker than they thought, so that acquisition is going to allow them a bit more flexibility with regards to reviewing its interim policy - which means, if you read between the lines, they could increase their dividend payout, and or invest in growth options," Smalley said. "Investors have obviously taken that as a reasonable positive, the market kind of priced that in and we've seen a bit of bargain hunting around $7 that's seen the stock on a strong run recently. They have reserved the possibility they might use that additional cash flow on growth options so investors might not see it, it's positive but the market's not taking it too much to heart."

Smalley said there had been a continuation of buying into stocks which have been sold down in the previous few months, such as Fisher & Paykel Healthcare, which gained 0.8 per cent to $9.01, and Infratil, which rose 0.9 per cent to $2.965.

Tegel Group Holdings was the worst performer, down 2.3 per cent to $1.30, with Auckland International Airport dropping 1.5 per cent to $6.75 and Scales Corp falling 1.2 per cent to $3.39.

Outside the benchmark index, NXT-listed Oceania Natural was unchanged at $2.16. The Auckland-based company slashed its 2017 revenue forecast as deep discounts on rival honey products undermine sales into China, lowering its revenue target to $2.2m for the year ending March 31 from $5.4m.