New Zealand shares fell on the last trading day of 2013 on perceptions that valuations in the local market have become a little stretched pending more evidence of earnings growth. Xero, Summerset Group and Fisher & Paykel Healthcare paced the decline.
The NZX 50 Index fell 31.970 points, or 0.7 per cent, to 4737.010 and has advanced 17 per cent in 2013. Within the index, 30 stocks fell, four rose and 16 were unchanged. Turnover was just $22 million in a trading day shortened for the New Year holiday, about a fifth of its daily average this year.
Xero, the cloud-based accounting software company, fell 1.8 per cent to $32.30, having soared 333 per cent this year as investors bet on its potential to become a global giant killer and it raised enough capital to fund its expansion.
"The market is probably fully valued on current fundamentals," said Grant Williamson, a director at Hamilton Hindin Greene. Further gains "are not out of the question given the outlook for the New Zealand economy but the share market is quite a bit ahead of that."
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Investors will get a reality check with earnings season in February, he said.
On Wall Street the Dow Jones Industrial Average is ending the year at record levels. The NZX 50 reached a record high in November only to fall away as regulation or the threat of regulation hurt utilities, Chorus and companies in the Commerce Commission's gaze including Sky Network Television.
Chorus fell 1 per cent to $1.44 and has lost 51 per cent of its value this year as investors wait to see if the government will push back on regulated price cuts set for December 2014. Sky TV fell 0.2 per cent to $5.84. SkyCity declined 2.4 per cent to $3.73.
Summerset, the retirement village operator, fell 0.9 per cent to $3.25 after rising 46 per cent in 2013. F&P Healthcare declined 1.8 per cent to $3.85 and ended the year up 59 per cent. Ryman Healthcare was unchanged at $7.85, leaving intact its 73 per cent rally this year. Metlifecare was unchanged at $3.96.
"The outlook for Summerset and Ryman is still extremely positive as they continue their expansion strategy," Williamson said. "But on current fundamentals they are looking fully priced."
Telecom fell 1.5 per cent to $2.305 and Fletcher Building, the biggest company on the NZX 50, edged down 0.1 per cent to $8.51.
Warehouse Group, the biggest listed retailer, fell 2.9 per cent to $3.74, Precinct Properties New Zealand declined about 2 per cent to 99 cents and NZ Oil & Gas fell 3 per cent to 80.5 cents.