NZ market makes strong gains

The New Zealand sharemarket gained strongly today amid optimism about the global economic outlook even as companies continued to call on investors for new capital.

The benchmark NZSX-50 index closed up 32.724 points, or 1.078 per cent, at 3067.673. Turnover was worth $110.6 million, of which $30m was in Telecom. There were 61 rises and 21 falls among the 113 stocks traded.

Tower fell 7c to 174 after announcing plans to raise $81 million in a rights issue at 134 a share.

Selected exporters also fell as the NZ dollar rose above US68c with Fisher and Paykel Healthcare down 6c at 330.

The risers included the big listings with Telecom up 8c at 272, Contact up 5c at 625 and Fletcher Building up 3c at 777.

Today's gains came after exuberance in US markets following comments from Federal Reserve chairman Ben Bernanke that the economy was on the verge of recovery.

One of the beneficiaries in this market was jeweller Michael Hill, which has shops in North America. It was the biggest percentage gainer today, posting a 7.46 per cent rise to 72. The company reports tomorrow.

Mainfreight, which also has US operations, rose 15c to 530.

"Any talk of economic recovery helps the likes of Mainfreight," Stephen Wright at ASB Securities said. "They have thin margins so a turn around helps them," he said.

NZ Refining continued a bounce back from lows, rising 30c to 550 today.

Air NZ rose 2c to 124 and moved to deny media reports it was involved in an air cargo cartel investigation in Australia.

Freightways rose 4c to 312, Rakon rose 3c to 141, Port of Tauranga rose 13c to 654 and Sanford rose 5c to 505.

Nuplex rose 7c to 222 and Tourism Holdings rose 3c to 57.

In the US, stocks were also helped by a bigger-than-expected jump in home sales.

The Dow Jones industrial average rose 1.7 per cent to 9505.96, and the Standard & Poor's 500 index rose 1.9 per cent to 1026.13, its highest close since October 6 last year.

For the week, the Dow rose 2 per cent and the S&P 500 gained 2.2 per cent.

- NZPA