NZ stocks: Telecom lends support to softer market

12.55pm


Robust trade in lead stock Telecom lent some support to the New Zealand sharemarket this morning as it climbed down from yesterday's highs.

At 11.30am the benchmark NZSX-50 gross index was down 2.3 points or 0.09 per cent to 2521.94, while the NZSX-40 capital index was down 2.1 points or 0.09 per cent to 2340.55.

Turnover was a healthy $68.3 million, of which $29.06 million was in Telecom.

Telecom gained 6c to 567 to help offset the negative effects of falls in recent market stars and number two and three stocks Carter Holt Harvey and Contact Energy. Overall, losers outnumbered gainers 43 to 28 on 119 stocks traded.

"It's a bit mixed", Direct Broking's Peter Lynds said, adding other moves this morning were mainly in the order of one or two cents.

Strong gains in all three of the market's top stocks yesterday pushed the NZSX-50 gross index to a fresh closing high.

But today by 11.30am Carter Holt was down 5c to 209, and Contact was also down 5c to 570.

Investors had swarmed to Carter Holt in advance of its fourth quarter result tomorrow. Interest has focused on the company's plans to sell its tissue business and return funds to shareholders, as well as speculation it may sell off its forests.

The market's softer tone today "might just be a bit of profit taking, the market's had a reasonable rise lately", Mr Lynds said.

Meanwhile, the approach of the corporate reporting season would likely help the market higher in coming sessions.

"You've got a lot of announcements coming through and the market may continue to firm just prior to that".

Yesterday the local market was primed for its ensuing gains by a glittering session on Wall St which saw the Dow surge 1.3 per cent to a 2-1/2 year high.

However, the US influence this morning was negative as American stocks fell on weakness in chipmakers, and profit taking on the gains from yesterday's strong rally.

Back on the local market, shares to move by 11.30am included: Amp down 20c to 516, Auckland Airport down 3c to 675, BayCorp Advantage down 4c to 330, Cavalier Corp down 5c to 540, Dorchester Pacific up 5c to 280, Fisher and Paykel Appliances down 2c to 382, Fletcher Building up 3c to 415, Infratil up 3c to 291, Ports of Auckland down 5c to 775, Software of Excellence down 4c to 160, Steel & Tube Holdings down 4c to 395, TelstraClear up 2c to 566, TrustPower up 4c to 694, and the Warehouse up 2c to 529.

- NZPA