NZ stocks: Market rebounds, but rise only modest

6:00pm

True to form, the New Zealand sharemarket saw a modest bounce today despite large gains in offshore markets.

The NZSE-40 capital index closed up 16.50 points, or 0.84 per cent, at 1992.10, while the top-10 index was up 0.92 per cent at 897.33.

Turnover was minimal -- 18.49 million stocks valued at $47.44 million -- and was topped by Telecom's $19.64 million.

Wall Street saw some big gains overnight, with the blue-chip Dow Jones industrial average rallying 3.4 per cent to 7533.95 and the Nasdaq Composite Index scrambling up 4.42 per cent to 1163.36.

While the New Zealand market saw much smaller gains, Stephen Wright of ASB Securities said it was a good performance nevertheless.

"We never go down as much as anybody else, so our bounces consequently are never going to be as much as anyone else, I thought we did reasonably well.

"Just about everything appeared to be up across the board, apart from Auckland International Airport," he said.

The blue chip airport shares fell 3c to 431.

"No particular reason. They go ex-dividend on Monday, and in one week's time they go ex-the capital repayment. Some people don't want to be bothered by dividends and so forth, so nothing sinister (in the fall) ..."

Baycorp Advantage rose 25c after hitting an all-time low yesterday of 295, a long way from the end of last year when the stock peaked at 770 following the merger of the New Zealand and Australian companies.

"Baycorp is just showing some relief, that's been down day after day," Mr Wright said.

"I think it needed to (rise), the last report (chief executive) Keith McLaughlin said they were going to achieve 20 per cent earnings growth, and you wouldn't have thought that from the way the share price was falling."

On Monday, Baycorp announced it had paid a A$10 million ($11.5 million) settlement, relating to three proceedings issued prior to the merger.

"But like Westpac and lots of other shares, every bit of bad news is being punished heavily by the market, in terms of market capitalisation lost (stocks have) been punished much more than any original infringement."

WestpacTrust was up 10c at 1420, and AMP also rallied, closing up 35c at 1345.

"That reflects international markets, because AMP's a big equities investor around the world, and in Britain in particular."

Britain's FTSE-100 closed up almost 1 per cent after a run of negative days, while Europe's blue chip stocks ended sharply higher.

Market heavyweight Telecom was one of the reasons behind the New Zealand market's rise, gaining 7c to 506.

"It was expected -- all these things you'd expect, but whether this is a relief rally or a one-day rally, time will tell," Mr Wright said.

Elsewhere on the market, Carter Holt Harvey rose 1c to 163, ahead of its nine-month result on Wednesday, Contact Energy was up 2c at 382, Fisher & Paykel Healthcare gained 17c to 985, F&P Appliances was up 9c also at 985, Sky City rose 5c to 740, and pay television company Sky TV was up 5c at 335.

One week old Turners Auctions was up 10c at 245, its highest point since listing last Friday.

Another to have suffered recently, Restaurant Brands, rose 8c to 167, while Dunedin-based Scott Technology rose 30c to 220 following its six-fold increase in after-tax profit yesterday.

On the down side, convertible notes in Sky City Leisure, formerly Force Corp, were down 4c at 208, Rubicon shed 1c to 72, and Pacific Retail lost 2c to 298 on a mere 820 shares.

There were 60 rises and 19 falls on the 125 stocks traded.

- NZPA