22 Jan 2013

Stock market had strong year in 2012

10:17 pm on 22 January 2013

Trading on the stock market has jumped 22% last year due to rising investor confidence.

The stock market enjoyed a strong year in 2012 with the benchmark NZX 50 index rising by a quarter, fueled by the modest economic recovery, increased flows of KiwiSaver funds, low interest rates and new floats by Fonterra and brewer Moa Group.

Stock exchange operator NZX said 902,273 share trades were made last year - a fifth more than the previous year. The value of trades rose 6% to $30 billion.

However, the value of new listings fell 60% to $1.6 billion.

The total amount of money raised by firms plunged by a similar proportion, to $4.6 billion, though this was in comparison to 2011 when AMP had raised $5 billion to buy AXA.

Last year, NZX chief executive Tim Bennett expressed optimism about the stock market's prospects for 2013 led by the Government's expected partial privatisation of Mighty River Power some time in the first half of the year.

Some commentators are, however, concerned about a lack of private firms considering the option of a share float.

On Tuesday's trading, the NZX 50 benchmark index lifted fractionally, by 2 points to close at 4187 on a turnover of $85 million.

At the end of the local business day, the New Zealand dollar was buying 83.96 US cents, 79.72 Australian cents, 52.93 pence, 75.45 yen, 0.6286 of a euro and the Trade Weighted Index was at 75.45 points.