NZ stocks: Shares make good gains in morning trade

12.30pm

The New Zealand stock market made robust gains this morning following mostly positive sessions on offshore bourses yesterday and renewed buyer interest in market leader Telecom.

At 11.30am the NZSX-50 gross index was up 18 points or 0.8 per cent to 2257.89 , while the NZSX-40 capital index rose by 12.9 points or 0.6 per cent to 2166.48.

T urnover was a solid $72 million, boosted by $29 million of trade in Bhp Billiton stock and $25 million in Telecom.

On Wall St yesterday stocks rallied in early afternoon trading, after a batch of positive economic indicators reinforced optimism on Wall Street that the economic recovery is well under way.

Britain's biggest shares rose, boosted by the encouraging US economic data and Wall Street rally, but weak oil stocks and caution over future UK consumer spending tempered the gains.

Japan's Nikkei stock average closed above 11,000 for the first time in 15 months, spurred higher by computer giant Fujitsu's late-day rally on news it had sealed a big rise in the value of its contract with the British government.

Back in New Zealand the market was led upward by belwether Telecom which gained 9c to 512 by 11.30am.

Among other gainers in early trade were Auckland International Airport up 16c to 676, the Fisher & Paykel stocks, with Appliances up 4c to 1490 and Healthcare up 5c to 1260, Promina Group up 9c to 345 and PowerCo up 6c to 178.

Direct Broking's Peter Lynds said there was "a bit of interest coming through in Telecom as a result of that announcement yesterday".

The Commerce Commission yesterday released a draft report recommending Telecom be compelled to open its copper wire "local loop" to competitors to fuel competition in the broadband market.

Telecom shares were sold off a little bit yesterday in a knee jerk reaction to the news Mr Lynds said, but this morning the stock had firmed up on good volume -- with 4.8 million shares changing hands by 10.30am.

Elsewhere, Mr Lynds said Contact Energy was slightly better this morning "on that decision coming through on their dams".

Yesterday the power company was given approval to operate its Clutha River hydro-electric scheme for another 35 years. By 11.30am Contact was up 2c to 480.

Overall the market was showing a firmer tone, "Generally you've got 1c - 2c rises in some of the others like Carter Holt Harvey and Fletcher Building. There just seems to be a bit of buying interest in the market."

Fletcher Building was up 2c to 417 and Carter Holt Harvey rose 1c to 175 in early trade.

Other stocks to move by 11.30am included:

Air NZ down a cent to 51, AMP up 5c to 755 , BayCorp Advantage up 2c to 268, BIL International up 3c to 76, Briscoe Group up a cent to 184, Hellaby Holdings down 3c to 491, Independent Newspapers Ltd up 3c to 458, Michael Hill down a cent to 424, NZ Refining Co up 15c to 1645, NZX up 3c to 457, Pacific Retail Group up 10c to 235, Sanford up 3c to 518, Sky City up 3c to 874, TelstraClear up a cent to 566, TrustPower up 3c to 490, and Turners Auctions up 5c to 390 .

Rises outnumbered falls 47 to 22 on 116 stocks traded by 11.30am.

- NZPA