NZX 50 drops to month low

THE NZX 50 Index has dropped to a month low as investors await evidence of earnings growth that would justify a fully priced bourse.

Fisher & Paykel Healthcare fell ahead of reporting annual earnings on Thursday, while Ryman Healthcare declined after earnings this week met expectations.

The benchmark index fell 26.318 points, or 0.5 per cent, to 5108.573 on Wednesday.

Within the index, 31 stocks fell, nine rose and 10 were unchanged. Turnover was $116 million.

The NZX 50 has advanced 7.9 per cent this year, outperforming Australia's S&P/ASX 200 Index's 1 per cent gain and Japan's Nikkei 225 14 per cent decline.

F&P Healthcare dropped 1.4 per cent to $4.16, and has gained 7.8 per cent this year.

Ryman Healthcare, the retirement operator which reported annual earnings on Monday, slid 1.7 per cent to $8.30.

"People are deciding that perhaps the New Zealand market has run too far - we've got GDP growth that has accelerated to a point now where it's not going to continue to accelerate," said Paul Harrison, managing director at Salt Funds Management.

"Our market has gotten highly valued now, and we really need some strong results from companies.

"Looking at that Ryman result the other day, people are used to them exceeding expectations and they didn't."

Rival retirement village operator Summerset Holdings Group dropped 2.8 per cent to $3.46, while Metlifecare was unchanged at $4.21.

Diligent Board Member Services, the governance app maker, led the benchmark index lower, dropping 3.9 per cent to $4.25.

Trade Me Group, the online auction site, was the day's best performer, rising 2.9 per cent to $3.61 after dropping to a two-year low on Tuesday.

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PM says sex line wink a response to host

PRIME Minister Tony Abbott says he was just reacting to his radio host when he winked and smiled in response to a talkback caller who said she resorted to phone sex work to make ends meet.

One of the calls Mr Abbott took on Melbourne radio on Wednesday was from a chronically ill grandmother and pensioner named Gloria, who said she worked on a phone sex line to pay her bills.

The prime minister immediately winked at ABC presenter John Faine following the admission from the woman, who said she would have to find at least $850 more a year following a federal budget including contentious Medicare co-payments.

A spokeswoman for Mr Abbott told Fairfax Media the wink was to assure the presenter he was happy to proceed with the call, but the Prime Minister later told Perth's 6PR radio that he was simply reacting to Faine's facial expression.

"It was a reaction to John, really," Mr Abbott told Fairfax radio.

"Obviously it was an interesting call from someone who had an interesting story.

"John was smiling at me and I responded to him."

He dismissed claims the Medicare co-payment for an individual's first 10 visits to the GP each year was unfair.

"Is it fair and reasonable to charge people $5 or $6 even if they're pensioners for their PBS drugs?

"Why is it somehow grievously wrong to ask people to make a similar contribution when they go to the doctor?"

Mr Abbott also rejected the suggestion the debt levy represented a broken election promise, given he admitted it was a tax and had promised voters there would be no new taxes or big surprises.

"I'm not saying it's not a new tax - I'm saying we haven't broken any of our fundamental commitments.

"I think we're getting on with the job of keeping all of them.

"I appreciate there are a lot of people running around saying that we've broken commitments.

"These things are in the judgment of the commentariat.

"I'm very comfortable with this. I think it's what this country needs now."

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Xie said 'I hate you all to death': court

GRANDFATHER Yang Fei Lin says his relationship with accused killer Lian Bin "Robert" Xie became splintered over his slain son's assets in the months after five Lin family members were murdered in their Sydney home.

At one point things got so heated, he said, that Xie yelled: "I hate you all to death."

Xie is accused of creeping into the home of his brother-in-law Min Lin and sister-in-law Lily Lin in North Epping in the early hours of July 18, 2009.

The crown says he was motivated by bitterness when he killed Min, Lily, her sister Irene and their two sons Henry, 12 and Terry, nine, with a hammer-like weapon.

Xie has pleaded not guilty.

For the second day, Mr Lin gave evidence in his son-in-law's trial explaining how after the killings and before Xie's arrest that fractures began to form.

Speaking through an interpreter, Mr Lin became animated as he recounted one argument in September 2009, in which he said Xie became "really angry".

"(He) jumped up and shouted 'Why do you think there are two families now? I hate you all to death'," Mr Lin recalled.

"(Robert) said: 'Get out of my house, get out of my house', and I replied, 'You're a bastard'."

By the end of 2009, a dispute about the guardianship of the surviving member of the family and the assets of their dead son, Min, was in full swing.

Mr Lin said Xie questioned why he would not give any of the inheritance to his wife Kathy.

Mr Lin said he and his wife Feng Qing Zhu replied: "We are not dead yet. How can you fight over the assets with us?"

Mr Lin said he believed his son had assets totalling more than $2 million at the time of his death.

The court has previously heard Xie and Kathy had not worked steady jobs since moving to Sydney in 2005.

Mr Lin said he had told Xie prior to the murders that they weren't happy about that, to which he replied: "Well everyone has their own different lifestyles".

The court heard that in the year before Lily's death, Mr Lin found her diary that had a series of entries about a man called "Rob".

"Having been trained by Rob these years, and lived with him 'together' made me a lot more familiar with him ... I hate to part with him," she wrote in one entry.

Mr Lin said he confronted his daughter-in-law about it, saying "my family does not have extra-marital affairs".

He said Lily wouldn't tell him who Rob is, simply saying he was "from the pyramid selling business".

The court has previously heard that Lily suffered from a mild mental illness and would occasionally believe she was having affairs with men.

The trial continues.

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ICAC on hold following Hartcher departure

Geoffrey Watson SC has apologised for his conduct while examining Chris Hartcher at the ICAC. Source: AAP

SOME politicians take the high road after a stint before the NSW corruption watchdog.

Chris Hartcher chose the low road - the basement carpark, in fact.

The sidelined ex-Liberal energy minister beat a hasty retreat from Independent Commission Against Corruption (ICAC) offices on Tuesday afternoon, refusing to speak to journalists and shielding his face from the cameras.

His departure marks the end of two combative days of evidence, and the start of a two-month interlude in the ICAC's cash-for-favours inquiry.

Operation Spicer has heard Mr Hartcher masterminded the creation of "sham" company EightByFive, which allegedly issued fake invoices to disguise illicit political donations from property developers including Sydney's Gazal family and former coal mogul Nathan Tinkler's Buildev.

He is also accused of using his own nephew to launder $4000 in Liberal Party donations through his old law firm and then through a business run by the partner of long-time aide Ray Carter, before "pocketing" the cash.

On Tuesday he denied instructing Mr Carter - who has admitted to soliciting donations from banned political donors in the lead-up to the 2011 state election - to lie to the inquiry.

Barrister James Trevallion put it to Mr Hartcher that he showed up at Mr Carter's house unannounced in November last year after ICAC investigators began circling.

"You said to him that you wanted to get your stories straight in respect to the $4000 because you knew it was likely to become an issue at ICAC," Mr Trevallion said.

"And you told him that he should say, if he was asked, that he kept the money himself."

"I reject that absolutely," Mr Hartcher shot back.

Under cross-examination from his own counsel, Mr Hartcher slammed suggestions from counsel assisting, Geoffrey Watson SC, that he leaked details of the notorious $3000 bottle of Grange that brought down former NSW premier Barry O'Farrell.

"I deeply resent that question being asked and it was completely untrue," he said.

"Mr Watson, you recklessly asked that question."

Tempers had cooled since Monday's evidence, when the verbal sparring between Mr Watson and Mr Hartcher became so heated Commissioner Megan Latham ordered the parties to "back off right now".

"I could try and blame it on the fact that I'm tired, or I could try and blame it on the fact that I'm red-haired. I'll just leave it at this: I apologise for what I did and I will try and correct my conduct," Mr Watson told Ms Latham on Tuesday morning.

The inquiry has now been suspended to allow evidence that allegedly implicates former NSW police minister Mike Gallacher in the donation rort scandal, to be further investigated.

Mr Hartcher was excused from the witness box - but not from his summons, meaning he may be recalled when proceedings resume on August 4.

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No rate change on RBA's horizon

The minutes of the RBA's most recent meeting show that interest rates aren't moving any time soon. Source: AAP

BORROWERS can rest assured that interest rates aren't going anywhere any time soon, with the federal budget expected to restrain economic growth.

The Reserve Bank has, yet again, indicated it has no plans to change the cash rate, which remains at a record low 2.5 per cent.

In the minutes of its May meeting, released on Tuesday, the board judged it was prudent to leave rates on hold while they continued to have the "expected effects" on economic activity.

"A sustained increase in dwelling investment was in prospect, consumption had strengthened a little and business conditions were around average levels," the RBA said.

"The board considered that the current accommodative stance of policy was likely to be appropriate for some time yet."

The outlook for the global economy hadn't changed, the RBA said, while the Australian economy appeared to have picked up a little over the past two quarters, as expected.

But the board said overall growth in coming quarters was likely to be below trend as growth in exports was expected to slow and mining investment continued to decline.

Growth would also be impacted by "fiscal consolidation", policy changes such as spending cuts and new taxes in the federal budget, which had yet to be released when the RBA met two weeks ago.

JP Morgan chief economist Stephen Walters said the minutes confirm that the RBA believes the economy's transition away from mining investment is a "work in progress".

"Officials seem hopeful that the economy is evolving pretty much as forecast, but don't seem to have a high degree of conviction around this assessment," he said.

"There was acknowledgment that auction clearance rates are fading and that demand for home loans, previously booming, had stabilised."

Mr Walters said the outlook for interest rates would hinge on how consumers and businesses react to last week's budget, and that another rate cut was possible.

"So far, indications are the reaction is pretty ugly; we expect a double digit fall in the (Westpac) consumer confidence reading tomorrow," he said.

CommSec chief economist Craig James said monetary policy was balancing fiscal policy.

"In a macro sense the budget isn't a major drag on the economy but the perception of hurt from budget changes is impacting confidence to a greater extent than the reality of the actual decisions," he said.

"The next interest rate decision on June 4 will be super-important... because the Reserve Bank will be able to give its judgment on the fiscal contraction associated with the federal budget and the implications that this poses for interest rate settings."

CommSec still expects a rate hike in late 2014 or early 2015, he said.

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"Everything is gone": Lin grandfather

THE morning after five members of his family were murdered, grandfather Yang Fei Li received a call from the alleged killer telling him "something terrible has happened".

He began silently praying for everything to be okay.

It wasn't long until he discovered "everything was gone".

Speaking through an interpreter, Mr Lin told the Supreme Court on Tuesday about the day he learnt his son Min Lin, 45, his wife Lily, 44, her sister Irene, 39, and his grandchildren Henry, 12, and Terry, nine, had been killed in their North Epping home.

He said the night before the discovery on July 18 2009, had been spent like any other Friday family get together at the grandparents' house.

His grandson Henry complained of having broken shoes, and his wife, Feng Qing Zhu had given him $50 for winning a badminton competition.

Mrs Zhu had even tried to get Henry to stay the night but the 12-year-old said he needed to play the sport first thing in the morning.

All in all, it was a harmonious, quiet, normal night, Mr Lin added.

The next morning, everything changed.

He got a call from their son-in-law Lian Bin "Robert" Xie, saying, "something terrible has happened to the Lin family," Mr Lin recounted.

"I asked, 'What happened? He said, 'I can't say it now ... get here by train as soon as possible'."

After Xie agreed to pick him and his wife up, Mr Lin recalled: "I didn't say anything even when I was in his car; I was silently praying that nothing bad had happened to my family."

Xie has been accused of carrying out the five murders with a "hammer-like" weapon. He has pleaded not guilty.

When they arrived at the Lin family home in Sydney's northwest, Mr Lin said he was told Lily, her sister Irene and the two children had died.

At this stage, however, his son Min's death had not been confirmed.

"I was always wondering if my son Min had been abducted," Mr Lin said.

It was only when the family were later taken to hospital to see a social worker that they were told nobody had survived.

"We were really heartbroken. Very sad. Everything is gone," Mr Lin said.

Earlier on Tuesday, Mr Lin told the court that before the "five members of my son's family were murdered we had a normal and good relationship with my daughter (Kathy) and her husband".

However, after the killings he said disputes concerning his son's inheritance and the guardianship of the sole surviving member of the Lin family began.

The trial continues.

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WA won't meet funding shortfalls: Barnett

THE Western Australian premier concedes the federal government's planned public hospital funding cuts will start having an impact from July 1, but the state won't cover the shortfalls.

After the opposition lashed Colin Barnett for skipping the gathering, the Liberal leader said he had "very good reasons".

GST distribution wasn't on the agenda and that is the key issue facing WA, so he will attend the next Council of Australian Governments meeting later this year, where it will be discussed before Prime Minister Tony Abbott.

There is "an unnecessary sense of panic" about the cuts, he added.

Mr Barnett previously said he was in no rush to discuss the health and education budget cuts because they wouldn't kick in for several years.

But on Monday, he admitted some impact would be felt, particularly in health, from the start of the new financial year.

"There are some National Partnership Agreements that it appears the Commonwealth may not continue. If that is the case, they will finish - the state is not in a position to pick up that gap in funding," Mr Barnett said.

"Some of the states - NSW and Queensland in particularly - at previous COAG meetings did special deals with the Gillard government. They can hardly be surprised that those deals have disappeared."

He flagged potential changes to eligibility for pensioner cards and health-care cards.

"Under the worst scenario, there would be $24 million less coming to WA. We would maintain our commitment, but we're not going to pick up any reduction in commonwealth entitlement."

While he previously said Mr Abbott had not flagged the funding changes at the previous COAG meeting, he claimed the prime minister had foreshadowed states and territories taking increased responsibility for education and health.

"Everyone agreed that was the way to go."

According to Mr Barnett, Mr Abbott also said there would be some compensatory arrangements, with the Commonwealth taking on increased responsibilities in other areas.

While WA hospitals faced a $196 million funding cut over the next four financial years, the overall impact of the federal budget on the state was positive, including "a slightly better position on GST ... and some funding in particular areas".

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Second death after Vic car crash

A SECOND person has died after a speeding car crashed into a Victorian suburban garage.

Three men were out getting food when the driver lost control and hit a pole before smashing into the garage of a Dromana home on Sunday night.

A man died in hospital about 4pm on Monday, a Victoria Police spokeswoman said.

It follows the death of a 28-year-old back-seat passenger, who police said was not wearing a seatbelt.

After the accident, the driver, 31, and other passenger, 27, were both airlifted to The Alfred hospital with head injuries.

Police were unable to reveal the identity of the second deceased man.

Detective Inspector Bernie Rankin said the car was well above the speed limit in the lead up to the accident.

"The driver for some inexplicable reason is exceeding the speed limit and the consequences have been rather dire," Det Insp Rankin said on Monday.

"It is a situation that is totally avoidable."

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Sacked minister to remain in LNP

QUEENSLAND'S sacked assistant health minister will remain a member of the Liberal National Party despite speaking out against aspects of the government's agenda.

There had been speculation Chris Davis could be kicked out of the LNP after a party room meeting on Monday.

The Member for Stafford was stripped of his cabinet position last week after speaking out on subjects including changes to the Crime and Misconduct Commission and new work contracts for doctors.

Dr Davis has since claimed concerns he raised with Premier Campbell Newman about plans to ease restrictions on political donations were a factor in his sacking.

Mr Newman has rejected Dr Davis's claims.

After the party room meeting on Monday, a spokesman for Mr Newman told AAP Dr Davis would remain a member of the LNP.

Deputy Premier Jeff Seeney said Dr Davis apologised at the meeting, ABC radio reports.

Earlier on Monday, several LNP ministers publicly chastised the doctor for his public statements.

"What Chris has to realise is that if you continue to cry wolf, you'll eventually lose credibility," Housing Minister Tim Mander told reporters.

"It's no good roaring like a lion in public and being as meek as a mouse in the party room."

Energy Minister Mark McArdle and Local Government Minister David Crisafulli echoed the Mr Manders' statements.

"Dr Davis has got a job to do right now and that is to get back and work for his electorate. Full stop. End of story," Mr Crisafulli said.

Dr Davis is expected to make a statement about his future in the party this week in parliament.

He hasn't returned AAP's calls.

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US woman gets 'custody' of her embryos

A US judge has awarded custody of frozen embryos to a 42-year-old Chicago woman. Source: AAP

A US judge has awarded custody of frozen embryos to a 42-year-old Chicago woman over the objections of her ex-boyfriend who said it violates his right to not procreate.

In 2009, Karla Dunston, began dating Jacob Szafranski, a 32-year-old firefighter. A few months into their relationship Dunston was diagnosed with lymphoma and had to undergo chemotherapy that would ultimately destroy her fertility.

She testified that she longed to have a biological child and asked Szafranski to provide his sperm so that embryos could be frozen prior to her treatment, and he did so, despite neither of them thinking the relationship had long-term prospects.

The couple broke up in May 2010. Szafranski said he changed his mind about being a father after friends and a girlfriend reacted negatively, according to court documents.

Judge Sophia Hall said Friday in a written ruling that oral agreements between Szafranski and Dunston concerning use of the embryos stand and added that Dunston's desire to have a child outweighs Szafranski's desire to not procreate.

"Karla's desire to have a biological child in the face of the impossibility of having one without using the embryos outweighs Jacob's privacy concerns, which are now moot," the judge said in the ruling, "and his speculative concern that he might not find love with a woman because he unhesitatingly agreed to help give Karla her last opportunity to fulfil her wish to have a biological child."

Dunston's lawyer, Abram Moore, applauded the ruling.

"Using these pre-embyros is important to our client, but it is equally important to her to set a precedent in Illinois which helps other women cancer survivors who find themselves in this heart-wrenching situation," he said in an email.

Szafranski's lawyer, Brian Schroeder, said they plan to appeal the decision.

"We're obviously very unhappy," he said.

Schroeder said lawyers for both parties have agreed that the embryos should not be implanted in Dunston until the appeal is completed.

Through a lawyer, Dunston previously has said she was not seeking any support, financial or otherwise, from Szafranski.

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