NZ stocks: Contact shines on dull sharemarket

12.00pm

Contact Energy shone on an otherwise dull sharemarket today.

A negative tone was set by Wall St where stocks fell 2 per cent to three-month lows as investors were spooked by the US$98.7 billion ($180 billion) loss announced by AOL Time Warner -- the largest in US corporate history.

The NZSE-40 capital index was down 3.46 points to 1972.49 at 11.30am on reasonable turnover of $40.1 million.

The main feature of the market was an 11c rise to a record high of 423 by Contact Energy. The rise was in response to reports from the owners of the Pohokura gas field which suggest the field will be significantly smaller than earlier projections. Contact is expected to benefit because the power prices will rise.

"The value of Contact Energy as a net generator of power, especially with a good hydro as well as thermal base, is one company that will benefit enormously from the kind of scenario we are looking at," said Macquarie Equities investment director Arthur Lim.

"The spur on this morning is definitely on the news on Pohokura," he said, adding that a minor tweaking of projected power prices could easily put a $5-plus value on Contact.

There was good turnover worth over $3 million.

Trustpower also gained 6c to 380, picking up the same sized loss from yesterday when it reported an improved nine-month, after-tax result of $39.2 million from a loss of $1 million in the same period last year.

Telecom, which reports its second quarter result on Tuesday, fell 5c to 442 -- the lowest level since mid-December for the market heavyweight.

Fletcher Building rose 3c to 353, 1c below its record. Building data today showed that new dwelling consents were at their highest since 1976.

AMP's woes continued, falling another 5c to 1019.

Baycorp fell 6c to 216, Cavalier fell 10c to 345, Carter Holt fell 1c to 175, Hellaby rose 8c to 335, Nuplex fell 8c to 340, Sky City fell 21 to 850 and Ryman fell 4c to 160.

Michael Hill recovered 10c to 595 after falling from $6.40 last week on reports of weaker sales over Christmas.

Rarely traded Nuhaka fell 110 to 790.

There were 27 rises and 42 falls among the 100 stocks traded.

- NZPA