MARKET CLOSE: NZ shares fall; Chorus, A2 drop, Metlifecare, ANZ gain

New Zealand shares dipped, with Chorus and A2 Milk Co declining, while Metlifecare and dual-listed banks rose.

The S&P/NZX 50 Index dropped 11.1 points, or 0.2 percent, to 7,167.64. Within the index, 23 stocks fell, 14 fell and 13 were unchanged. Turnover was $130.7 million.

Chorus was the worst performer, down 2 percent to $3.91, while A2 Milk Co fell 2 percent to $2.46 and Auckland International Airport declined 1.8 percent to $7.12.

Tegel Group was unchanged at $1.28. The Commerce Commission has warned the chicken producer, along with rival Inghams Enterprises, for packaging chickens with misleading sizes. The companies were "likely to have made misleading representations about chicken size by including stuffing and marinade in the weight of chickens" by specifying a weight range for a stuffed and marinated chicken while the weight of the chicken itself was lower, the regulator said.

Tegel shares, which sold in the company's initial public offering last May at $1.55, have weakened since, falling sharply in December after the company said it would miss its forecast earnings as a glut of chicken kept a lid on domestic prices and rising freight costs squeeze margins.

"They haven't been doing fantastically since they listed, investors will be looking for some good news before they get back in," said Grant Davies, investment advisor at Hamilton Hindin Greene.

Metlifecare was the best performer, up 3.3 percent to $6.30. Last month, it reported a 31 percent jump in first-half profit that was aided by a gain in the value of its property, while chief executive Glen Sowry cited strong demand for its units and an occupancy rate that has edged up to 97 percent. The shares have gained 7.7 percent since then.

"There's a continuation of momentum from Metlifecare, it was probably one standout in the market for its earnings and the market is re-rating them accordingly," Davies said.

Dual-listed banks Australia & New Zealand Banking Group gained 1.6 percent to $34.11, while Westpac Banking Corp gained 1.3 percent to $37.38. The Reserve Bank of Australia kept its cash rate unchanged at 1.5 percent today, as expected, and governor Philip Lowe said keeping borrowing costs unchanged "would be consistent with sustainable growth in the economy and achieving the inflation target over time."

(BusinessDesk)