NZ stocks: Telecom leads market higher on good volume

New Zealand's sharemarket was in good form today, with the benchmark index rising to a two-month high on healthy volume following rises in the United States.

The NZSE-40 capital index closed up 12.15 points, or 0.61 per cent, at 1987.94, while the top-10 index was up 0.76 per cent at 902.03.

JB Were institutional adviser Joe Gallagher said the market had got off to a good start for the year with decent volumes showing plenty of participants.

A large chunk of today's $141 million turnover , $42.6 million, was a trade in Kiwi Income Property.

However, Mr Gallagher said turnover was healthy in many other stocks, with Telecom leading the way on $52.59 million.

Telecom hit a high of 418 during the day before closing at 474, up 2c on yesterday's closing price.

The company gained interest from investors following news that US officials planned to ease requirements that local telephone companies rent parts of their networks to rivals at discount rates.

"However, people realised it was a bit more specific to the US," Mr Gallagher said, leading to Telecom's reduced gains by the end of the day.

After the market closed, Telecom said it had signed a $100 million, five-year contract with Air New Zealand.

Other blue chip stocks registered larger gains as new year cash entered the market.

Casino company Sky City closed up 11c at 820, Sky TV was up 10c at 355 on the back of continued strength in the New Zealand dollar, financial services company Tower gained 3c to 221, and Auckland Airport was up 4c at 549.

Carter Holt Harvey rose 2c to 182, Fisher & Paykel Healthcare gained 8c to 930, Fletcher Building was up 5c at 343, and Baycorp Advantage rose 1c to 221.

Hawke's Bay meat processor Richmond gained 50c to a 2-1/2 year high of 290 after news yesterday its South Island rival PPCS had launched a takeover bid at 305.

On the down side, F&P Appliances shed 10c to 990, The Warehouse lost 5c to 719, and jeweller Michael Hill was down 9c at 630.

There were 53 rises and 25 falls on the 127 stocks traded.

On Wall St, the Dow Jones industrial average surged 171.88 points, or 2 per cent, to 8773.57; the broad S&P 500 gained 20.42 points, or 2.25 per cent, to 929.01; and the Nasdaq Composite Index rose 34.17 points, or 2.46 per cent, to 1421.25.

- NZPA