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Shares edge up, led by Key joining Air NZ

NZ Newswire logoNZ Newswire 1/05/2017 Rebecca Howard

New Zealand shares rose on Monday on renewed enthusiasm for Heartland Bank and news Air New Zealand has tapped former Prime Minister John Key for its board, while Fletcher Building and Chorus fell.

The S&P/NZX 50 Index gained 3 points, or 0.05 per cent, to 7382.22. Within the index, 30 stocks gained, 13 fell and seven were unchanged. Turnover was $115 million.

"There has been renewed enthusiasm for the market as we see swap rates come back down again and the market being a little bit more supported,'' said Peter McIntyre, an investment adviser at Craigs Investment Partners.

New Zealand's 2-year swaps are at 2.28 per cent versus 2.40 per cent at the beginning of the year while 10-year swaps are at 3.36 per cent versus 3.44 per cent at the beginning of January.

Air New Zealand led the market higher, adding 2.4 per cent to $2.61.

Mr McIntyre said investors are upbeat about rising passenger numbers.

"It is carrying on good momentum for the 2017 financial year where some people might have anticipated a more dramatic slowdown because of increasing competition," he said.

Late in the day the company also announced Mr Key has been tapped to join the board of Air New Zealand, his first public appointment since stepping down on December 5.

Heartland Bank was also firm, adding 1.8 per cent to $1.69.

Mr McIntyre noted that recent economic data in New Zealand has remained strong "and they are a direct beneficiary of that''.

In the other direction, investors took profits in Fletcher Building, which had gained from the government's announcement last week of a boost to spending on transport infrastructure. Fletcher shed 1.4 per cent to $8.43.

Mr McIntyre said investors were also opting to take some profits on Chorus, which has gained over 5 per cent in the past month but was down 1.1 per cent at $4.44 on Monday.

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