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New Zealand Exchange Halts Equity Trading on Technical Issue

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July 1 (Bloomberg) -- NZX Ltd., operator of New Zealand’s stock exchange, halted equity trading due to an unspecified technical issue.

“NZX experienced connectivity issues across a number of its systems at around 12 noon today,” the company said in an e-mailed statement. “Given the uncertainty this caused and in the interests of running fair, orderly and transparent markets, NZX halted trading on all markets while it investigates the issue.”

New Zealand is the third-smallest equity market among 16 major countries in the Asia-Pacific region tracked by Bloomberg News, ranking below Pakistan and the Philippines. The nation is headed for its busiest year for initial public offerings in a decade after the sale of about 49 percent of state-owned Mighty River Power Ltd. in May as Prime Minister John Key pledged to raise between NZ$5 billion ($3.9 billion) and NZ$7 billion selling shares in state-owned companies.

“It does destroy the whole idea of a perfect market,” Evan Lucas, a Melbourne-based market strategist at IG Markets Ltd., a provider of trading services for equities, currencies and commodities, said in a telephone interview. “I would be really concerned about how you get yourself out of the market. You’re in limbo.”

NZX spokeswoman Kate McLaughlin in Wellington declined to provide further details in a telephone interview today and said an update will be released to the market at 3 p.m. local time.

Another IPO

Tim Bennett, chief executive officer of NZX, told Bloomberg TV June 28 that companies are currently more receptive to the possibility of listing on the country’s exchange.

The government plans to offer shares in Meridian Energy later this year. Infratil Ltd. appointed advisers for a potential IPO of fuel retailer Z Energy, and dairy company Synlait Milk Ltd. last week said it will offer new and existing shares to the public and seek a listing.

“The cause of this operational issue will be fully investigated, the findings of which will be reported back to the Financial Markets Authority and market participants,” McLaughlin said in the statement.

NZX shares gained 11 percent this year through the end of June, compared with a 9.2 percent advance on the benchmark NZX 50 Index.

To contact the reporter on this story: Adam Haigh in Sydney at ahaigh1@bloomberg.net

To contact the editor responsible for this story: Nick Gentle at ngentle2@bloomberg.net

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