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NZ shares rise led by Tegel gains

NZ NewswireNZ Newswire 19/08/2016

© Reuters New Zealand shares rose, led by Tegel Group on prospects for growth in Australia while Port of Tauranga dropped following broker downgrades.

The S&P/NZX 50 Index gained 20.14 points, or 0.3 per cent, to 7,405.26. Within the index, 24 stocks rose, 21 fell and six were unchanged. Turnover was $162 million.

Tegel Group led the index, up 2.9 per cent to $1.78. The shares have gained 8.5 per cent since an announcement on Thursday that it will be able to export raw poultry to Australia for the first time.

"It's probably one of the highlights - clearly investors are beginning to factor in potential export growth for the business," said Matt Goodson, managing director at Salt Funds Management.

A2 Milk Co gained 2.8 per cent to $2.18, Meridian Energy rose 2.3 per cent to $2.90, and Heartland Bank advanced 2 per cent to $1.50.

New Zealand Refining Co was the worst performer, down 2.7 per cent to $2.54. Mercury NZ dropped 2.3 per cent to $3 and Sky Network Television fell 2 per cent to $4.88.

Port of Tauranga dropped 1.2 per cent to $19.10. New Zealand's biggest port company posted a 2.3 per cent decline in full-year profit on Thursday, missing some estimates, while announcing plans to return $140 million to shareholders over four years and a five-for-one share split to boost liquidity. "The fact was, the results were a little soft and several brokers have cut their calls to a sell on valuation grounds."

According to Reuters, Port of Tauranga is rated a sell across two broker recommendations with a mean target price of $17.08.

Outside the main index, Michael Hill International was unchanged at $1.56, Insurance Australia Group's New Zealand division posted a 38 per cent slide in annual profit as rampant competition for commercial customers drove down prices and as the country's biggest general insurer faced a higher risk margin on the Canterbury earthquakes. The ASX-listed shares recently traded at A$5.80 and have dropped 0.9 per cent today.

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