Retailers drag sharemarket down

Shares in Michael Hill International fell 0.8 per cent yesterday to $1.32. Photo / Brett Phibbs

Investors wary after glut of new issues, and gloomy economic figures from Australia affect firms trading there.

New Zealand shares fell yesterday, as Ebos Group went ex the rights to buy shares in its offer, Warehouse Group led most retailers lower and a brokerage reportedly removed Trade Me from its favoured portfolio.

The NZX 50 Index fell 21.46 points, or 0.5 per cent, to 4442.12. Within the index, 34 stocks fell, nine rose and seven were unchanged. Turnover was $99 million.

Ebos Group fell 9.4 per cent to $9.43. The shares traded yesterday ex-entitlements to the company's $149 million, seven-for-20 pro rata renounceable entitlement offer, which is helping it fund the $1.1 billion acquisition of the Symbion pharmaceutical wholesaler and distributor in Australia. The rights were quoted at $2.93.

Stocks were broadly lower across Asia and Australia's S&P/ASX 200 Index was down 0.6 per cent in late afternoon trade.

The NZX 50 reached a record level last month and Wall St benchmarks have attained new highs, though the rally has paused as investors digest mixed global economic and monetary news, including the Bank of Japan's decision to keep its bond buying programme unchanged.

"There's no doubt there is a little bit of wariness about where stock markets have moved to," said Shane Solly, portfolio manager at Mint Asset Management.

The local market had suffered some indigestion with new issues and more to come, and companies exposed to Australia had been weighed down by gloomier economic figures across the Tasman, he said.

Trade Me fell 3.4 per cent to $4.60.

Warehouse Group, the biggest listed retailer, fell 1.6 per cent to $3.75 after government figures showed consumer spending rose 0.5 per cent in May caused by increased purchases of fuel, food and liquor, and hospitality. Clothing chain Hallenstein Glasson sank 3.6 per cent to $5.35, and jewellery retailer Michael Hill International declined 0.8 per cent to $1.32.

Fast food operator Restaurant Brands fell 1.2 per cent to $2.80 after shedding rights to its 9.5c-a-share final dividend. Tower went ex-dividend and was unchanged at $1.95.

Burger Fuel Worldwide was unchanged at $1.55 after the small-cap fast food franchiser reported a 55 per cent jump in annual profit on gains in its Middle East sales. The company said it would not pay a dividend, retaining cash to fund future growth.

Chorus fell 0.4 per cent to $2.58 after the end of the first day of a two-day Commerce Commission-led conference on proposals to regulate pricing on the company's ageing copper network.

Chief executive Mark Ratcliffe said the regulatory threat was "weird" to foreign investors. Telecom fell 0.9 per cent to $2.24.

Infratil edged up 0.5 per cent to $2.20. Mint's Solly said the prospects of a share sale from its Z Energy chain were in the back of investors' minds.