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NZ shares continue weakness

NZ Newswire logoNZ Newswire 12/12/2016 Sophie Boot

New Zealand shares dipped, led lower by A2 Milk Co on bad sentiment in the infant formula sector, while Orion Health Group continued to bounce.

The S&P/NZX50 Index fell 17.27 points, or 0.3 per cent, to 6,876.03. Within the index, 25 stocks fell, 19 rose and seven were unchanged. Turnover was $132.7 million.

A2 Milk was the worst performer, down 5 per cent to $2.29, on the news that Australian formula producer Bellamy's had gone into a trading halt on the ASX.

A2's shares gained 19 per cent early this month after the company updated shareholders at its annual meeting in Sydney, before dropping later that week after rival formula producer Bellamy's said demand on single's day in China had been lower than expected.

"It's down reasonably substantially, there's been no news out though it has had a strong run in the last while," said Mark Lister, head of private wealth research at Craigs Investment Partners.

Air New Zealand fell 1.9 per cent to $2.12 and Vital Healthcare Property Trust dropped 1.7 per cent to $2.

"We have been quite weak over the last several days, just about every market had a strong week last week and we were flat, so I think our market still a little bit lacklustre in the wake of the political changes you've seen in the last week, " Lister said. "Obviously that was unexpected, and while we've now got a new prime minister who's very capable and credible, it's still given people a bit of reason to pause for thought and consider the political landscape."

Units in Fonterra Shareholders Fund dipped 0.2 per cent to $5.94. At the annual meeting of the Fonterra Shareholders Fund, chairman John Wilson urged new prime minister Bill English to continue to drive to regional and mult-lateral trade agreements.

Orion Health was the best performer, up 9.7 per cent to $2.15. It's now bounced 30 per cent from the record low of $1.65 reached last week.

Sky TV rose 1.9 per cent to $4.89, Tower gained 1.8 per cent to 85.5 cents, and Chorus advanced 1.4 per cent to $3.975.

Heartland Bank was unchanged at $1.53. It wants to raise up to $30 million through a placement and share purchase plan to maintain its capital ratio after strong lending growth, as well as support its digital strategy.

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