21 May 2014

Global dairy prices drag dollar down

6:31 pm on 21 May 2014

The New Zealand dollar has fallen more than half a cent against the US dollar, propelled lower by global dairy prices sinking to a 15-month low.

ANZ Bank senior foreign exchange strategist Sam Tuck said a falling Australian dollar also dragged the kiwi down.

"The global dairy trade auction result ... is definitely a factor in keeping the New Zealand dollar under pressure today," Mr Tuck said.

"The New Zealand dollar followed the Australian dollar lower on Australian-specific concerns, notably Chinese iron ore, but the weakness in the global dairy trade has raised concerns that generally prices of commodities demanded by China - iron ore and dairy - are under pressure, keeping the New Zealand and Australian dollars lower."

Just after 5pm, the New Zealand dollar was buying: 85.52 US cents, 92.64 Australian cents, 50.78 pence, 0.624 euro, 86.52 yen and 5.33 renminbi.

Shares fall

Meanwhile, the New Zealand share market fell for the fifth consecutive day.

The benchmark top 50 index fell 26 points to 5109; a week ago it closed at 5213.

Hamilton Hinden Greene director Grant Williamson said the market took its lead from offshore.

"The market has weakened off again today, I think mainly on offshore concerns," Mr Williamson said.

"We're also seeing a little bit of profit-taking in the market place. I think a number of investors are finding it difficult to find value in the market at the current time and are really just holding back waiting for prices to retreat somewhat."

Among the main movers for the day was Ryman Healthcare, which fell 14 cents to $8.30 after advising the market it had bought a second Melbourne site for a new village "at a pretty hefty price".

"I think investors are just in the mood to be taking some profits out of this market," Mr Williamson said.

Argosy Property shares are unchanged at 95.5 cents, even after it announced its annual net profit had more than doubled to $85.6 million, thanks to a big jump in the value of its properties.

Abano Healthcare shares rose 7 cents to $7, although turnover was less than 7000 shares.

Abano Healthcare has sent a letter to shareholders alleging former director and disaffected shareholder, Peter Hutson, is conducting a misleading communications campaign.

Mr Hutson has requisitioned a special meeting to vote on removing chairman Trevor Janes.