SHAREMARKET Trading lacks fire

Press, 15 September 1988, Page 37

SHAREMARKET Trading lacks fire

The record Fletcher Challenge result failed to fire the New Zealand sharemarket yesterday. The Barclays industrial index managed only a 10.67-point gain to 1980.52. The Stock Exchange’s gross index, which is not affected by exdividend movements, was up 8.44 to 725.82. Fletcher was ahead 2c at the opening bell, the same time as its mid-morning announcement. By late morning buying demand surged and the issue ended on its high of 495 c for a 12c gain. Turnover was 10.1 million shares, worth SI2M, and volume was again boosted by Met Life Group. The issue had a further 2.1 million shares traded, 2 million going through at 185 in a special sale, and closing on market at 175 c for a 10c gain. A total of 31.5 million Met Life shares was traded on Tuesday, as FAI Insurance, of Australia, took a controlling 61 per cent interest and announced it was bidding for the rest. The September Barclays futures contract moved sharply to a 20-point premium to the physical, having trailed at a four-point discount on Tuesday. Mr Derek Howarth, market operator for Lawrence Millton Howarth, a Christchurch sharebroker, said prices moved up marginally during the morning session with the capital index not reflecting the general improvement because several companies went ex-dividend. This distorted the true index rise. The Fletcher result, up 50 per cent to $532.3M was above market expectations, with continued strong growth in earnings predicted for the 1988-89 year. Sharp rises in the Australian market and a drop in New Zealand call rates contributed to local optimism, which should flow through into trading in the short term, he said.

Chase Corporation was second highest on volume, 1.4 million shares traded off-market at 114, the issue closing at a steady 115. Goodman Fielder Wattie completely recovered Monday’s 14c drop, when it added the second consecutive 7c gain in a row to end at 300, its high for the day. Other trans-Tasman companies to firm included Elders Resources NZFP up 4c and ANZ Banking Group 20c to 647. Among second-line issues, Ceres Pacific slipped 4c to 36 as top management with close to a controlling interest continued to work to shore up the company in the wake of the Rada mess. Ra Ora jumped 8c to 128, the issue having sold between 115 and 150 c since Arrowfield Group, of Australia, formerly Australasian Racing and Breeding Stables, announced a share-swap bid in June. On September 2, Arrowfield said it held 90.5 per cent of the outstanding shares. Arthur Barnett, which announced it was moving the head office of DIC stores back to Dunedin, gained 30c to 150. Equiticorp International was among the few leaders to slide, easing 1c to 46. Maagnum Corporation was also down 2c ex-dividend and bonus, but Carter Holt Harvey gained 4c ex-dividend to 166. Spectrum Resources retreated 2c to 39 and New Zealand Goldfields lost 5c to 20 as the bullion price remains static. Premier, now an associate of Como Holdings, lost 1.5 c to end at Ic. New Zealand Oil and Gas firmed 1c for the second consecutive session. The Barclays mining index rose a marginal 0.17 points to 174.93. Although the Australian sharemarket was sharply higher, other overseas markets remained static. Tokyo shares were marginally firmer, the Nikkei index gaining 11.51 points to 27,805.67.