MARKET CLOSE: NZ shares follow Wall St higher; Warehouse, Xero gain

New Zealand stocks rose, led by Warehouse Group, following Friday’s rally on Wall Street as jobs data boosted confidence in the world’s largest economy’s recovery. Summerset Group Holdings gained on its third quarter sales.

The NZX 50 Index edged up 4.32 points, or 0.08 percent, to 5241.314. Within the index, 26 stocks rose, 13 fell and 11 were unchanged. Turnover was a lighter-than-usual $69 million as Australia’s largest state, New South Wales, had a public holiday, while markets in India, the Philippines and Malaysia were also closed.

Stocks on Wall Street rose on Friday after the US reported better than expected jobs, pushing the jobless rate down to 5.9 percent, the lowest level since July 2008, according to Labor Department data. Investors are watching data out of the US closely, as the Federal Reserve looks to wrap up its bond buying programme this month, which has brought money into the markets in a bid to stimulate growth and give markets confidence after the global financial crisis. Minutes for September’s Fed meeting are out this week, which should give further insight into the central bank’s thinking on hiking interest rates.

“Offshore markets on Friday night put in some good performances. New Zealanders are starting to pay pretty close attention to what is happening overseas, and obviously there are a few worldwide issues,” said Grant Williamson, director at Hamilton Hindin Greene. “Investors are still being relatively cautious. The market has taken a wait and see attitude to see what happens offshore as the week progresses.”

Warehouse, New Zealand’s largest listed retailer, advanced 1.6 percent to $3.12. Port of Tauranga climbed 1.3 percent to $16.10. Pacific Edge, the Dunedin-based biotech company, rose 1.1 percent to 92 cents. Xero, the cloud-based accounting software firm, gained 1 percent to $21.54.

Summerset Group Holdings, the retirement village operator and developer, advanced 1.1 percent to $2.82, after it reported new sales for occupation rights in the third quarter rose 31 percent with strong sales at its new villages, while resales fell due to limited stock. The Wellington-based company reported 99 sales of occupation rights in the three months ended Sept. 30 from 102 in the same quarter a year earlier.

Energy generators and retailers were mixed. Meridian Energy fell 1.4 percent to $1.43. MightyRiverPower climbed 1.4 percent to $2.56. Genesis Energy gained 0.3 percent to $1.955.

Fletcher Building, the country’s biggest listed company, fell 0.7 percent to $8.60, and Spark New Zealand, formerly Telecom Corp, fell 0.7 percent to $2.885.

Hamilton Hindin Greene’s Williamson said optimism concerning New Zealand’s own growth has weakened, as falling dairy and log prices, the country’s largest and third largest exports, have declined, adding to an already cautious investing environment.

“Dairy prices have really put a little bit of a spanner in the works, and that has also made investors a bit cautious even though the economic outlook is not too bad,” Williamson said. “Reduced payouts and reduced farmer income is going to be felt pretty widely right throughout New Zealand’s economy.”

Units in the Fonterra Shareholders’ Fund, which gives investors exposure to Fonterra Cooperative Group’s dividends, was unchanged at $6.38 after reports Sri Lanka had suspended sales of some New Zealand products amid fears it may have made some children sick. Rival dairy processor Synlait Milk rose 3.4 percent to $3.62.

Guinness Peat Group, which owns UK threadmaker Coats, was the worst performer on the day, falling 3.4 percent to 57 cents.

Kathmandu Holdings, the outdoor goods retailer, declined 2 percent to $2.99.

Shares of Vector fell 0.4 percent to $2.62 as the Auckland lines company continued to deal with a major outage in the country’s biggest city, that saw power disrupted for 85,000 businesses and households.