NZ stocks: Market stands up to Wall St pressures

The sharemarket withstood Friday's tremors on Wall Street, closing down yesterday but by no means out.

"The market showed a bit of character," JB Were's senior investment adviser Peter Stokes said.

It hit its lows at midday, after which people wanting to fill orders pushed some prices back up, cutting the market's deficit.

"Given Wall Street had a bit of a shake over the weekend, we've held up all right," Mr Stokes said.

"Even relative to the Aussie market we've done pretty well today."

The NZSE-40 capital index closed down just 5.54 points, or a third of a per cent, at 1909.56.

Smaller stocks managed to gain, and the NZSE-SCI capital index closed up 10.09 points at 5128.98.

Wall Street ended last week with the Dow Jones industrial average down 2.3 per cent and the Nasdaq composite down 6.2 per cent as the arguments supporting a hard landing for America's 10-year expansion increased in force.

Locally, total turnover of 17.43 million shares was worth $60.04 million.

Volume was down because many investors are still on holiday, and because of the usual Monday slowness.

Fletcher Energy accounted for $19.19 million-worth of turnover and dominant stock Telecom, $17.67 million.

Falls outnumbered rises 50 to 35 among the 128 stocks traded.

Mr Stokes was sanguine about the market's prospects for this year, despite the American volatility, saying the interest rate environment looked good for equities. And he said the market had faith in the Federal Reserve's ability to manage the US slowdown.

Credit Suisse First Boston's David Price said our market looked "interesting."

He predicted a local rates cut from the Reserve Bank in May if not in March.

And he said that New Zealand stocks, while not immune to overseas influence, had never reached the over-valued levels in the American markets.

Among the local leaders, Contact Energy, dogged by financial concerns surrounding its 40 per cent cornerstone shareholder Edison Mission, lost 2c to close at 264.

The stock has rallied several times on rumours that Edison would increase its stake but it now appears such rumours are not about to come true.

Lion Nathan gained 6c to 506, possibly getting some benefit from rumours that arch-rival Australia's Fosters is a takeover target.

Also, Mr Stokes said that with the present uncertainty people were moving into Lion as a defensive stock.

AMP lost 79c to 2406, pared back after a good run in recent months for Australian financial stocks, which are also used as defensive plays.

Fletcher Forests went up 1c to 30, but Fletcher Energy fell 16c to 805.

Fisher and Paykel rose 5c to 800, Sky City went up 6c to 835 and Telecom closed unchanged on 490.

Tower gained 5c to 520, and Carter Holt went down a cent to close at 166.

Air NZ B shares, which foreigners can own, fell 6c to 226.

Genesis dropped 30c to 640, and Guinness Peat was down 3c at 143.

Infratil was down 2c to 119, but Kiwi Income Property Trust went up 3c to 89.

- NZPA