18 Nov 2013

Dollar firms but sharemarket weaker

7:21 pm on 18 November 2013

The New Zealand dollar has firmed against the currencies of all our major trading partners.

Westpac currency strategist Imre Speizer said weak United States economic data meant it was likely the Federal Reserve would continue printing money into next year.

"The kiwi dollar against the US has risen and that's largely due to some weak US economic data released on Friday night. (It's) further support for the idea that the Fed won't be tapering its asset purchase programme this year," Mr Speizer said.

"So that is weakening for the US dollar and, in turn, it has pushed kiwi-US higher."

The US data included industrial production falling in October as output at power plants and mines declined.

Just after 5pm, the New Zealand dollar was buying 83.47 US cents, 88.86 Australian cents, 51.76 pence, 0.6186 euro and 83.57 yen.

Sharemarket weaker

The sharemarket was weaker, with the benchmark NZX Top 50 Index shedding 22 points to 4892.

Air New Zealand dominated investors thoughts - despite not trading - on news the Government will sell about 220 million shares in it.

Forsyth Barr advisor Damian Kearns said the Government was trying to get $1.60 a share or more, compared with last Friday's close of $1.65.

Telephone lines company Chorus was a big drag on the NZX Top 50 Index today, Mr Kearns said.

"In light of the ongoing regulatory uncertainty facing Chorus, Chorus has elected to withdraw its full-year 14 dividend guidance of 25.5 cents per share," he said.

"Investors expect capital growth or dividends from listed companies and, at this stage, we're not seeing any growth and the potential for the dividend to be reviewed was certainly not taken well by the market today."

Chorus shares fell 10.5 cents to $1.90, while shares in Hallenstein Glasson dropped 4 cents to $4.46 after the company provided first-half 2014 net profit after tax guidance of $8 million - down about 22% on the previous six months.