New Zealand shares rose today, led by Air New Zealand and Spark New Zealand, while Sky Network Television fell to its lowest level in almost eight years after its merger with Vodafone was disallowed by the Commerce Commission.

The S&P/NZX50 Index gained 27.05 points, or 0.4 per cent, to 7,089.52. Within the index, 28 stocks rose, 14 fell and eight were unchanged. Turnover was $186.3 million.

Sky TV dropped 13 per cent to $3.78, making it the biggest decliner on the day and reaching the lowest level since June 2009.

The shares tumbled when trading opened on the New Zealand stock exchange this morning, with investors wiping $293 million off the value of the pay-TV provider after the regulator rejected its proposed merger with the New Zealand operations of the global telecommunications giant, Vodafone.


"The market was erring on the side of the ComCom approving the deal, as can be seen by the sharp price reaction," said Matt Goodson, managing director at Salt Funds Management.

"It's perhaps a bit surprising the ComCom hasn't considered new entrants, which are obviously rampant in the telco media space -- it'll be very interesting down the road when it comes to bidding for sports rights," he said.

Spark New Zealand, which opposed the merger, gained 1.2 per cent to $3.53.

Air New Zealand was the best performer, up 4.7 per cent to $2.25. It posted a 24 per cent fall in first-half pretax profit in the face of increasing competition both at home and abroad but fared better than analysts expected.

New Zealand's national carrier was forecast to post a 45 per cent decline in first-half earnings to $186.5m on a 2.6 per cent decline in revenue to $2.63 billion, according to Forsyth Barr analyst Andy Bowley.

Summerset Group gained 3.1 per cent to $5.06 and Z Energy dropped 2.3 per cent to $7.16.

A2 Milk Co bounced 1.7 per cent to $2.37. It dropped 4.5 per cent yesterday after the milk marketer's chief executive and chair sold down their stakes.

"The problem is visibility -- they've executed extremely well compared to Australian peers, but it's hard from the outside looking in to have visibility as to whether that's continuing or not, so it takes on a bit more significance even if it may be perfectly reasonable to take a bit off the table," Goodson said.


Fletcher Building rose 1.2 per cent to $9.80. The second biggest stock by market cap led the index lower yesterday, down 5.2 per cent, after it posted a 2 per cent gain in first-half profit to $176 million that included unexpectedly weak earnings from its construction division.

The shares had soared 54 per cent in the past 12 months on optimism it would benefit from a boom in Auckland residential construction.

"It's bouncing back after yesterday's sharp fall. The key disappointment was the one-off loss in the contracting business, but the stock had obviously had a tremendous run through 2016," Goodson said.

Warehouse Group rose 1.1 per cent to $2.66. It expects to shed a net 130 jobs, or about 1.1 per cent of its workforce, in an effort to save up to $20m a year after slimming down the structure of its retail model to try to strip out duplication.

Vital Healthcare Property Trust gained 0.7 per cent to $2.075. The Auckland-based hospital and healthcare property developer and investor said its first-half net distributable income rose 87 per cent to $35.5 million as acquisitions and developments helped drive rental income growth. Net profit fell to $45.5 million from about $59 million in the previous year.

Port of Tauranga advanced 0.2 per cent to $4.43. It posted an 8.5 per cent gain in first-half profit to $41.9m and raised its full-year guidance, saying both exports and import cargo volumes rose, including a rebound in the outbound log trade. Revenue climbed 2.8 per cent to $125m.

Outside the benchmark index, SLI Systems plunged 24 per cent to 34c.

The Christchurch-based e-commerce software seller more than doubled its first-half loss to $1.28m as a strong New Zealand dollar and the loss of three major customers at the end of the 2016 financial year continued to weigh on earnings.

Revenue declined 12 per cent to $15.7 million. Its preferred measure of growth, annualised recurring revenue, dropped 13 per cent to $31.1 million.

Intueri Education Group was unchanged at 1.6 cents. It halved its full-year loss to $23.3m after taking a smaller charge on impairments, offsetting a 14 per cent decline in revenue. Impairments were $15m, down from $59.8m in the previous year. Revenue fell to $78.9 million from $91.6 million.

Gentrack Group rose 3.3 per cent to $3.43. It expects first-half sales to rise about a fifth as a number of projects came on stream in the period, making up for any headwinds from a strong New Zealand dollar.