KEY POINTS:
The sharemarket recovered from a 27-month low today, boosted by investors keen to take advantage of Fletcher Building's plunge to a three-year low.
The NZSX-50 index closed down 1.7 points at 3404.6, having earlier been as low as 3377.5. Turnover was a light $71.9 million.
The index, which understated the market fall because it included dividend payments, has dropped around 21 per cent since early October.
Third-ranked Fletcher Building closed up 5c at 675, up from a three-year low of 658 earlier in the session.
"That's purely coming from a majorly oversold position, and bargain hunters entering the market," said Grant Williamson of Hamilton Hindin Greene.
Fletcher Building has halved in value since July as investors fret about the housing and construction market in New Zealand and the United States, where it has recently increased its exposure.
Unlike many firms, Fletcher has barely downgraded its profit guidance.
Top stock Telecom was up 5c at 384, Contact Energy rose 6c to 838, Sky City was up 2c at 334, Fisher & Paykel Healthcare was flat at 233, and F&P Appliances rose 3c to 215.
"Lack of domestic news, not too much driving the market in that regard, so (investors are) concentrating on what's happening offshore," Mr Williamson said.
World markets have been hit by the US subprime mortgage crisis and the related credit crunch, rocketing high oil prices, slumping house prices and diminishing household incomes.
Locally, the market has been affected by high interest rates, an overvalued currency, drought, and falling economic growth.
Energy company TrustPower fell 40c, or 4.8 per cent, to 800 after warning that its profit outlook is being hurt by low hydro lake levels. The financial impact of the 2008 drought was uncertain, TrustPower chief executive Keith Tempest said.
Tourism Holdings continued to lose ground after last week's profit warning, sliding 2c to 148.
The Warehouse was down 5c at 510. Investors are awaiting a Court of Appeal decision on whether Foodstuffs or Woolworths can launch takeover bids.
Losses were across the board. Air New Zealand lost 3c to 109, Guinness Peat Group was down 2c at 155, Methven lost 9c to 165, Rakon was down 5c at 315, PGG Wrightson fell 10c to 253, and NZ Oil and Gas was down 3c at 153.
On the rise were Ports of Tauranga, up 3c at 682, Pumpkin Patch, up 5c at 165, Sky TV, 6c higher at 439, and Sanford, up 3c at 523.
Australia's S&P/ASX 200 Index was up 0.7 per cent at 5406, while Japan's Nikkei share average was flat.
Earlier on Wall Street, US technology stocks rose for the third consecutive session, on optimism about sales for Research in Motion's BlackBerry and Apple's new iPhone.
- NZPA
