SHAREMARKET Withdrawal of bid scares buyers off
The New Zealand sharemarket continued its easier trend yesterday, depressed by the withdrawal of the Ranks Hovis McDougall take-over offer for Goodman Fielder Wattle, and a weakening of the New Zealand-Australian dollar crossrate.
The market had been firmer in morning trade, after strong gains on Wall Street over the week-end, but weakened in the afternoon as the Australian dollar fell.
The Australian dollar slipped US2c in the afternoon, forcing the kiwi/aussie cross rate above 80c. This put pressure on dual-listed stocks.
Ranks Hovis McDougall’s withdrawal of its takeover offer for Goodman Fielder Wattie, although not unexpected, added to the pressure. The Barclays index of industrial shares fell 21.30 points to 1938.74, while the NZSE gross index closed 3.86 points down to 715.09.
Falls just pipped rises, as 7.7 million shares changed hands for $l5 million — an average of 196 c a share. Taking away 2.5 million Goodman Fielder shares, trading was very light. Mr Tim Preston, of Hamilton Hindin Greene, said that the market had a bit of a shake-out in the afternoon, mainly because of two factors:
"First, the withdrawal by Ranks Hovis McDougall of its take-over offer for Goodman Fielder appeared to catch the market long in the stock, which caused a certain amount of unloading. “Secondly, our dollar firmed considerably against the Australian dollar, which depressed dual-listed stocks.
“These two factors had a sobering influence on our market, somewhat unexpectedly, as overseas markets were firm. “The local market looked somewhat oversold at the end of the day, yet buyers were lacking. "However, the undertone is strong, and there is nothing to worry about,” Mr Preston said.
Goodman lost 14c to 294 yesterday as speculative investors dumped the stock. Bank of New Zealand shed 5c to 101 ahead of annual results due soon.
Chase Corporation recovered 5c to 33. Fisher and Paykel fell 9c to 391 and after last week’s announcement that it would build a refrigerator plant in Queensland.
Fletcher Challenge lost 5c to 484, while Brierley Investments (163) and Elders Resources NZFP (304) were 1c easier.
Permanent link to this item
https://paperspast.natlib.govt.nz/newspapers/CHP19890523.2.120.20
Bibliographic details
Press, 23 May 1989, Page 25
Word Count
347SHAREMARKET Withdrawal of bid scares buyers off Press, 23 May 1989, Page 25
Using This Item
Stuff Ltd is the copyright owner for the Press. You can reproduce in-copyright material from this newspaper for non-commercial use under a Creative Commons BY-NC-SA 3.0 New Zealand licence. This newspaper is not available for commercial use without the consent of Stuff Ltd. For advice on reproduction of out-of-copyright material from this newspaper, please refer to the Copyright guide.
Copyright in all Footrot Flats cartoons is owned by Diogenes Designs Ltd. The National Library has been granted permission to digitise these cartoons and make them available online as part of this digitised version of the Press. You can search, browse, and print Footrot Flats cartoons for research and personal study only. Permission must be obtained from Diogenes Designs Ltd for any other use.
Acknowledgements
This newspaper was digitised in partnership with Christchurch City Libraries.
Log in