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Tower, Orion Health, A2 Milk lead NZX up

NZ Newswire logoNZ Newswire 8/12/2016 Sophie Boot

New Zealand shares rose as Tower extended its gains from a 16-year-low and Orion Health Group climbed, with global equity markets gaining ahead of an announcement from the European Central Bank overnight that may include an extension to its quantitative easing.

The S&P/NZX50 Index gained 26.24 points, or 0.4 per cent, to 6,916.01. Within the index, 30 stocks rose, 14 fell and seven were unchanged. Turnover was $138 million.

Tower led the index, up 5.2 per cent to 81 cents. The stock has risen 13 per cent since Nov. 29, when the insurer said it will separate its liabilities and receivables from the Canterbury earthquakes into a separate 'bad bank' structure and "aggressively pursue" recoveries from the EQC and reinsurer Peak Re that amount to about $101 million. It's down about 60 per cent this year, dragged lower by investor concerns over the long tail of earthquake costs.

"It's taken a fairly severe beating of late, the jury's really out in terms of what they can actually do in forming new-co, old-co, how that would actually work if they can get it to work," said David Price, a broker at Forsyth Barr.

Orion Health rose 4.9 per cent to $1.73, A2 Milk Co gained 3.4 per cent to $2.44, and Sky Network Television advanced 2.8 per cent to $4.80.

Infratil was the worst performer on the index, down 2.6 per cent to $2.66. Spark fell 1.8 per cent to $3.535 and Auckland International Airport declined 1.5 per cent to $6.295.

Units in Fonterra Shareholder Fund dipped 0.2 per cent to $5.92. Fonterra Cooperative Group told shareholders at its annual meeting in Darfield today that the indicative payout level to its 10,500 farmer suppliers this season will be $6.40 per kilogram of milk solids.

Outside the benchmark index, Hellaby Holdings rose 0.3 per cent to $3.46.

NZME was unchanged at 55 cents while ASX-listed Fairfax Media gained 1.7 per cent to 88 Australian cents. Fairfax, which plans to merge its New Zealand media business with rival NZME, confirmed speculation it had been approached by a third party about the acquisition of its New Zealand unit, but said it's not in talks with the potential buyer.

On the Unlisted platform, Blue Sky Meats was unchanged at $1.30.

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