SHAREMARKET Recovery at close

Press, 30 May 1989, Page 19

SHAREMARKET Recovery at close

The sharemarket opened on a weak note, but recovered later in the day to close off its lows.

The Barclays index of industrial shares eased 5.81 points to 1884.99, but this was about 10 points better than the lunchtime level. The NZSE gross index closed 2.07 points down at 694.09, after being down 4.89 points at noon.

However, falls outnumbered rises almost three to one, on the low volume of 6.1 million shares exchanged for $14.0 million — the high average of 231 c a share.

The New Zealand market had opened lower because the market across the Tasman had been expected to slide after Moodys credit rating agency's announcement that it would review Australia’s borrowing status. Moody’s had said it was reviewing its Aal rating. for Australia, focusing on issues such as the uncertain outlook for commodities, the pace of

industrial change, and political factors constraining fiscal, monetary, and wages policies. But Australia finished the morning only 5 points lower.

An announcement from the New York-based investment bank Salomon Bros said the re-rating was unjustified.

The Australian dollar also recovered from its lows against the New Zealand currency. The kiwi dollar moved back to Aust7B.sc, after earlier nearing 80c.

This helped the leaders, especially Fletchers, although there was already good demand for the stock from across the Tasman, where it was selling at a 5c premium.

Mr Patrick Lee; of the Christchurch office of United Sharebrokers, said that buyers stayed away yesterday morning, but that some returned in the afternoon.

"At the end of the day the prices of most leaders were pegged back by a small margin,” he said.

"Waitaki went against the trend, the shares gaining 4c after last week’s announcement of a return to profit. "At present the market has slipped into neutral gear as it looks for some stability in the currency and Australian markets,” Mr Lee said.

The high average in trading yesterday was attributable to the sale of a large parcel of Fletcher Challenge shares — 1.2 million. They edged up 1c to 476, on the highest volume of the day. Brierley Investments, Goodman Fielder Wattie, BNZ, and Robt Jones Investments, were unchanged, but Carter Holt Harvey, at 243, and Elders NZFP at 302, each slipped Ic, while Lion Nathan and NZI Corp lost 2c each to 294 and 48, with 3c falls by both lEP at 264 and Magnum at 382. Chase Corp edged up 1c to 35, but Fisher and Paykel lost 5c to 400, and Wilson and Horton dropped 3c to 655.