NZ stocks: Fletcher Forests springs up 11 per cent

12.00pm

The New Zealand sharemarket was in the black today after news Fletcher Forest would try to sell its entire estate, worth about $1 billion.

By late morning, the benchmark NZSX-50 gross index was up 11 points, or 0.52 per cent, at 2132.49, on turnover of 13.52 million valued at $28.45 million.

Topping turnover was Telecom's 2.48 million stocks worth $12.66 million.

Fletcher Forest shares sprang up 12c, or 11 per cent, to 112 after announcing today it was planning to sell its entire forest estate. By late morning they had settled to 111.

The company will offer the forests -- some 100,000ha -- as a trade sale, to be sold in a block to one party or a consortium.

"I've always said they're worth more than the share price, the only thing is they've still got to prove that," Stephen Wright, of ASB Securities, said. "This is very good news.

I am a bit surprised they've gone to 112 -- they're worth that but they've shown no sign of being worth that in the past."

Major Fletcher shareholder Rubicon picked up as well, rising 4c to 72, and fellow forestry stock Carter Holt Harvey was up 3c at 168.

Tranz Rail was up 2c at 91 despite announcing today it was lowering its forecast operating profit for the year to June to $40 million.

The rail operator, subject to a revised bid from Australia's Toll Holdings of 95c per share, said factors contributing to the revised outlook included softer than forecast trading results and a change in accounting treatment.

Mr Wright said the market had looked through the forecast revision in favour of Toll's increased bid.

"There's still some way to go in that -- we don't know if the Government will win through or if there'll be some compromise, or room for both."

Tranz Rail shareholders vote on the Government's bailout on July 11.

Auckland International Airport shares reacted positively to news it would see a $6 million increase in annual after-tax profit as the result of it becoming the owner of a section of state highway.

Auckland Airport shares gained 5c to 580.

Elsewhere on the market, leader Telecom was up 1c at 512, The Warehouse gained 6c to 466, Tower rose 1c to 154, and casino company Sky City was up 5c at 890.

AMP was down 1c at 588, Contact Energy shed 5c to 477, and NZX shares lost 4c to 406 on light volume.

Fisher & Paykel Healthcare, which goes ex-dividend 40cps today, was down 27c at 1123 while F&P Appliances, which goes ex-dividend 27cps, was down 36c at 1270.

Among the other stocks to go ex-dividend, Kiwi Income Property Trust (3.5c per unit) was down 4c at 105 by 10am, and Sanford (9cps) was unchanged at 507.

There were 34 falls and 32 rises on the 101 stocks traded.

On Wall St on Friday, the Dow Jones industrial average fell 79.43 points, or 0.86 per cent, to 9117.12; the Standard & Poor's 500 Index dropped 9.90 points, or 0.99 per cent, to 988.61; and the Nasdaq Composite Index was down 27.13 points, or 1.64 per cent, at 1626.49.

- NZPA