NZ stocks: Vertex, Contact hog spotlight

A stand in the market for a hunk of plastic manufacturer Vertex helped spur general interest in the sharemarket, brokers said.

The NZSE40 Capital Index closed up 11.66 points to 1959.58, up 0.6 per cent on turnover worth $79.8 million. The index has now roughly recovered all its losses, after a fall of more than one per cent on Friday.

Wider trading appeared to be bolstered by a stand for 19.9 per cent of Vertex.

"The market had a buoyant feel to it and I'm sure some corporate activity goes some way to the positive vibe of it all," noted JB Were senior investment adviser Peter Stokes.

Brokers said it appeared there were competing bids for Vertex, which tumbled from its listing price of 205 in July last year to a low of 110 after it issued a profit warning in September.

JB Were started the ball rolling, confirming it was under instruction to seek out Vertex shares at $1.45 per share.

Despite slightly higher bids, that was the price Vertex closed at, up 13c on $5.3 million worth of shares, which represented roughly 12 per cent of the company.

The market spotlight also shone on Contact Energy which traded up to a new high of 450 today before easing back to 447, up 21c.

At today's annual meeting in Christchurch, Contact's chairman Phil Pryke said in hindsight, he was pleased Edison Mission's takeover bid for Contact last year at $4.14 had failed.

Brokers said Contact was sought after following a solid first quarter result yesterday and the likelihood of power price rises to help meet the shortfall of the Maui gas field.

The power and gas company announced this morning it would restore its New Plymouth station to dual fuel capacity to help boost power supplies.

Market leader Telecom topped turnover on $40 million worth of shares, and rose 3c to 452. It was not a huge runaway gain but the stock had languished since its half year result last week, said Mr Stokes.

"I feel there is a better story within Telecom than the price is suggesting at the moment, so maybe just a few people are taking a longer-term view."

Offshore interest was also evident in number two stock Carter Holt Harvey, up 3c to 179 on $7 million worth of shares.

Profit-takers appeared to swoop on Fletcher Building, pushing it down 11c to 367 ahead of its half year result tomorrow.

Fletcher Forests, which reports on Thursday, saw its ordinary and preference shares rise 3c and 4c respectively to 114 on slimmer volumes.

The Warehouse continued its recovery from last week's hammering, rising 7c to 603. Longer term investors appeared to be showing interest again in the company after crunching last week's disappointing Christmas quarter sales figures, Mr Stokes said.

Other movers included Carter Holt up 3c to 179, Hallenstein Glasson up 8c to 290, Sky TV up 6c to 355, yo-yo stock Sky City Entertainment down 19c to 850 and takeover target Richmond down 8c to 292.

There were 34 rises and 21 falls on 96 stocks traded.

There was also a positive tone on Wall St, as hopes rose that a move by Iraq to allow overflights by U-2 surveillance planes might stop an imminent war.

The technology-laced Nasdaq Composite Index rose 14.22 points, or 1.11 per cent, to 1296.69. The blue-chip Dow Jones Industrial Average gained 55.88 points, or 0.71 per cent, to 7920.11. The broader Standard & Poor's 500 Index rose 6.28 points, or 0.76 per cent, to 835.97.

- NZPA