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NZ shares drop pre-reporting season

NZ NewswireNZ Newswire 3/08/2016 Sophie Boot

NZX fell 1 per cent to $1.04 © AAP Image NZX fell 1 per cent to $1.04 New Zealand shares dropped as investors booked profits ahead of reporting season, with the main index led lower by Sky TV and Meridian Energy.

The S&P/NZX50 Index fell 51.8 points, or 0.7 per cent, to 7,277.4. Within the index, 34 stocks fell, 12 rose and five were unchanged. Turnover was $160.5 million.

"We've come off the boil a little bit - the weakness we're seeing offshore is flowing through to local investors and a few of them are deciding to take some profits ahead of the financial reporting season," said Grant Williamson, director at Hamilton Hindin Greene.

"Investors are maybe a bit cautious ahead of reporting season, and it's not surprising given what our market has achieved in recent times."

Williamson said there was specific profit taking in some stocks which did well in July, such as Sky TV, Meridian and Spark.

Sky TV fell 2.8 per cent to $4.90, Meridian dropped 2.5 per cent to $2.785 and Spark declined 2.1 per cent to $3.78. All three stocks gained in July, with Meridian up 7.3 per cent and Spark rising 11.8 per cent that month.

Due to the continuous disclosure obligations listed companies have, investors are unlikely to be surprised by the size of profits in this reporting season, so outlooks will determine market reaction, Williamson said.

Kathmandu Holdings dropped 2.3 per cent to $1.73 and Mercury New Zealand fell 1.9 per cent to $3.03.

NZX fell 1 per cent to $1.04. Cash market trading volumes fell in July, led by a drop in equities, although a 6.5 per cent gain in the S&P/NZX 50 Index meant the value of trading was still higher than in the year-earlier month. Total trades last month fell 5.6 per cent from a year earlier to 122,670, according to NZX's monthly shareholder metrics. The total value traded rose 3.6 per cent to $3.4 billion.

Skellerup Holdings was the biggest gainer, up 1.5 per cent to $1.36, while Heartland gained 1.5 per cent to $1.37 and Xero rose 1.1 per cent to $19.90.

Outside the main index, Briscoe Group rose 2.8 per cent to $3.36 and Infratil declined 0.6 per cent to $3.38.

Millennium & Copthorne Hotels NZ gained 4.4 per cent to $1.88. The hotel owner, which has a controlling stake in property developer CDL Investments, posted a 98 per cent jump in first-half profit as it benefited from the nation's tourism boom, strong sales from CDL and a one-time insurance gain.

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