NZX Hits 8000 | Takeovers – Mantra Group, Select Harvest

10 October 2017

Global markets were mixed overnight, with muted trading on Wall Street given it was Columbus Day holiday (banks were closed but markets were open).

Looking at the local markets, election uncertainty didn’t hold back the NZ market on Monday (with the NZX 50 breaking through the record 8000 index level), although the NZ dollar continued to trade lower.

In Australia, there was takeover news across 2 of the stocks under our research coverage – Hotel, Resort, & Accommodation provider Mantra Group (MTR:ASX), and Almond company Select Harvests (SHV:ASX). 

Stock in Focus: Mantra Group (MTR.AX)

Shares of Mantra Group, jumped 16% higher yesterday following an announcement that Accor S.A. is conducting due diligence and has made an indicative non-binding proposal of $3.96 per share. Mantra said the discussions are “incomplete” and a deal would be subject to a number of conditions.

We have held a positive rating on Mantra given its exposure to our tourism boom investment thematic. We are currently BUY rated on Mantra.

Members can login to read our latest reports and lookout for a full update on Mantra to be releaed in our weekly report.

Australia & New Zealand Market Movers

The Australian share market continued its rally on Monday (ASX 200 index +0.50%) underpinned by strong gains in mining stocks, which hit a more than three-week high after copper prices registered their largest weekly gain since late August.  

Select Harvests, the almond producer, also announced a takeover offer which saw its shares jump +26%. It said Mubadala Investment Company PJSC had offered to acquire the company for $5.85 per share via a scheme of arrangement that was “non-binding, indicative and highly conditional”.

 

The New Zealand market started the week with gains (NZX 50 index +0.41%) as the NZX50 market index passed the record 8000 level. Gains were led by recent market darlings A2 Milk and Xero, which both now significantly impact overall market returns. The NZ dollar appeared to retrace on NZ political uncertainty. In other stock news,  Michael Hill International rose as the jewellery retailer lifted sales 7.8 percent in the first quarter as its performance in New Zealand, Australia, and Canada continued to improve, making up for a dip in US revenue.

 

3 Things Markets Will be Watching this Week

1.                 The NZ political situation and negotiations as a coalition government is formed now that all the special votes have been counted.

2.                 While markets have largely brushed off the geopolitical situation with North Korea, risks remain.

3.                 Minutes from the last US Fede4ral Reserve Meeting are released on Thursday.

Have a Great Day,

Team

Global markets were mixed overnight, with muted trading on Wall Street given it was Columbus Day holiday (banks were closed but markets were open). Looking at the local markets, election uncertainty didn’t hold back the NZ market on Monday (with the NZX

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