NZ stocks: Market caught in pre-Christmas sell-off

7.00pm

The New Zealand sharemarket was still generally in the red in the lead-up to Christmas, although market leader Telecom managed to buoy the indices.

The benchmark NZSE-40 capital index closed up 10.02 points, or 0.52 per cent, at 1930.90, while the top-10 index was up 0.85 per cent at 871.81.

Turnover of 23.26 million stocks, valued at $77.30 million, was topped by Telecom's 5.54 million stocks worth $25.41 million.

Ken Lister of Forsyth Barr said that despite the top-40 finishing in the black, the market was continuing its pre-Christmas sell-off.

However, Telecom's 12c gain to close at 463, rebounding from a 14-month low of 439 on Tuesday, buoyed the overall market.

"I think recent negative sentiment has pushed it down too far and we're just seeing a recovery there -- there's no news out," Mr Lister said.

"Sentiment's definitely worsened, it's certainly gone below our lowest valuation on it. We have a range of 450/515."

Elsewhere, the stellar casino stock Sky City closed down 12c at 793, Auckland International Airport lost 6c to 531, Fletcher Building shed 5c to 337, retail giant The Warehouse lost 3c to 710, and Baycorp Advantage was down 1c at 203.

Tranz Rail was down 1c at 101, despite the successful conclusion of its $65 million capital raising.

"The Fisher & Paykel stocks were both down -- down 3-1/2 per cent for Appliances (at 985) and down 3 per cent for Healthcare (to 915), and I think some of that will be the impact of our dollar strengthening ... just to do with the money they're making from offshore sales," he said.

The New Zealand dollar is trading near three-year highs, and has appreciated more than 4 per cent since the end of November.

"(F&P) do have a hedging policy, but the currency is up at US51.56c at the moment."

On the positive side, Independent Newspapers Ltd was up 10c at 300, Contact Energy gained 7c to 387, Air New Zealand was up 1c at 52, and Northport, which upped its profit forecast to $7 million from $4.5 million, rose 10c to 310.

There were 42 falls and 40 rises on the 128 stocks traded.

On Wall St, the Dow Jones industrial average fell 88 points, just over 1 per cent, to 8447, as concerns about Iraq rose; the broader Standard & Poor's 500 Index fell 11.88 points, or 1.32 per cent, to 891.11; and the Nasdaq Composite dropped 30.57 points, or 2.2 per cent, to 1361.48.

- NZPA