MARKET CLOSE: NZX50 runs away with 22% gain in 2017

New Zealand shares dipped in the final trading day of 2017 on lacklustre holiday volumes, rounding out a 22% annual gain for the benchmark index in what's been a stellar year for a2 Milk Co.

The S&P/NZX 50 Index slipped 10.45 points, or 0.1%, to 8398.08. Within the index, 21 stocks fell, 16 gained, and 13 were unchanged. Turnover was a lighter-than-usual $45.3 million.

Milk marketer a2 was the top performer on the benchmark index for 2017, soaring 279% as earnings upgrades coincided with increasing Chinese demand. That ebullience abated through the tail-end of the year, and the stock slipped 0.7% to $8.07, rounding out a 4.3% decline in December as some investors cashed in gains.

"We tend to be a little bit on the cautious side when you've had a good run for so long," says Chris Timms, an adviser at Craigs Investment Partners in Dunedin.

"A lot of people have only ever seen the share market go one way, but having said that, New Zealand companies still look in pretty good financial position."

Mr Timms says it's hard to see a catalyst that will drive the local market lower in 2018 and it will probably be an event overseas.

Stock market operator NZX rose 0.9% to $1.12. Sky Network Television led the market lower, falling 2.8% to $2.81, while Summerset Group declined 1.8% to $5.50 and Auckland International Airport fell 1.3% to $6.48.

Portfolio adjustments
Grant Williamson, a director at Hamilton Hindin Greene in Christchurch, said institutional investors might also be adjusting their portfolios for the end of the reporting period in very quiet holiday trading.

"Volumes are pretty much non-existent. Most firms will be on skeleton staff and investors will be more worried about the New Year than the markets," he says.

"There might be some book squaring at the end of the day given its the last trading day of the year."

Tourism Holdings posted the biggest gain on the day, up 1.5% to an all-time high $6.05 and rounding out a 64% rally this year.

Mr Timms says the rental campervan operator is still benefiting from the prospect of increased profitability from US tax reform and the persistent strength of the domestic tourism market.

Real estate investors Goodman Property Trust and Argosy Property also gained, up 1.1% to $1.38 and 0.9% to $1.085 respectively.

Fisher & Paykel Healthcare ended the year as the biggest locally listed company, valued at $8.13 billion. The shares rose 0.8% to $14.35 today and gained 68% in 2017.

Spark New Zealand increased 0.1% to $3.61 today for an annual increase of 6.9%, while Fletcher Building dipped 0.5% to $7.60 and marked a 28% annual decline.

(BusinessDesk)