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NZ shares rise after Sky announcement

NZ NewswireNZ Newswire 25/05/2016 Sophie Boot

NZ shares rise after Sky announcement © Facebook / Sky TV NZ shares rise after Sky announcement New Zealand shares rose after Sky TV chief John Fellet said he'd resisted the temptation to acquire media assets and was awaiting advice from Citibank that may include making a capital return. Orion Health Group also gained while Tower extended its decline.

The S&P/NZX 50 Index gained 35.38 points, or 0.5 per cent, to 6,908.04. Within the index, 24 stocks rose, 17 fell and nine were unchanged. Turnover was $189.4 million.

Sky TV gained 3.1 per cent to $4.29. Analysts estimate the company could free up $400 million when its capex programme winds down in about six months and Fellet told BusinessDesk there was a question about what to do with that cash flow. Returning money to shareholders could be by way of a share buyback or increased dividends, he said. The pay-TV operator slid as low as a $3.98 after it said this month that subscriber numbers are expected to fall further this financial year, causing earnings next year to miss analyst estimates.

"It's coming in for a bit of bounce-back buying - it was possibly a bit overdone around the $4 mark, it bounced at those sort of levels last time as well," said James Smalley, director at Hamilton Hindin Greene.

Orion led the index higher, gaining 4.3 per cent to $4.82. The stock has risen 44.4 per cent this year.

Xero rose 2.7 per cent to $16.95, Heartland Bank advanced 2.5 per cent to $1.25, and Auckland International Airport gained 2.3 per cent to $6.36.

Comvita advanced 0.6 per cent to $12.87. The New Zealand manuka honey products maker is linking up with Blenheim-based apiary operator Putake Group to form a South Island-based honey business to meet global demand for manuka honey.

Tower dropped 5.8 per cent to $1.47.

Air New Zealand shed 1.9 per cent to $2.02, and has declined 30 per cent this year after it hit a 13-and-a-half-year high in January when oil prices hit record lows.

"It's pretty much lost a dollar in a little over a month, it's really taken the winds out of investors sales," Smalley said.

Precinct Properties fell 1.5 per cent to $1.28 and Steel & Tube Holdings dipped 1.5 per cent to $2.01.

Outside the main index, Arvida Group gained 6.3 per cent to $1.18 and AFT Pharmaceuticals fell 0.7 per cent to $3.

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