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Shares fall, Briscoe up on record profit

NZ Newswire logoNZ Newswire 14/03/2017 Sophie Boot

New Zealand shares dropped on Tuesday ahead of an expected interest rate hike this week by the US Federal Reserve, which may help drive up local borrowing costs.

Precinct Properties and Tegel Group fell while Briscoe Group gained after reporting record annual earnings.

The S&P/NZX50 Index dropped 17.7 points, or 0.2 per cent, to 7,177.09. Within the index, 26 stocks dropped, 15 rose and nine were unchanged. Turnover was $148 million.

Global markets are expecting the US Federal Open Market Committee to lift the fed funds rate a quarter point to a range of 0.75 per cent to 1 per cent at their meeting, held on Thursday New Zealand time.

That would narrow the gap with the Reserve Bank's 1.75 per cent rate which the New Zealand bank has projected to remain on hold.

"We're funded predominately from offshore, our interest rate markets are really driven by what's happening in the US," said Peter McIntyre, investment adviser at Craigs Investment Partners.

Precinct Properties was the worst performer on the index, down 2.6 per cent to $1.14, while Tegel Group dropped 2.4 per cent to $1.24 and Air New Zealand declined 2.2 per cent to $2.28.

Kathmandu Holdings was the best performer, up 2.6 per cent to $1.96, while Meridian Energy rose 2.6 per cent to $2.78 and Xero gained 2 per cent to $18.98.

Outside the benchmark index, Briscoe Group rose 0.2 per cent to $4.40. The homeware and sporting goods chain lifted annual profit 26 per cent to deliver another record profit as it bolstered fatter margins with a gain on the sale of a Hastings property and dividends from Kathmandu Holdings.

Energy Mad gained 4.2 per cent to 2.5 cents. The energy efficient light bulb maker and marketer is up for sale as the company's board weighs up the future of the business.

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