New Zealand shares rose on expectations forecasts in Thursday's budget will add to confidence about the pace of economic growth. Air New Zealand and Telecom paced the advance.
The NZX 50 Index rose 9.754 points, or about 0.2 percent, to 5162.423. Within the index, 19 stocks rose, 17 fell and 14 were unchanged. Turnover was $125 million.
Air New Zealand led the market higher, gaining 3.3 percent to a six-and-a-half-year high of $2.20. Last November the government sold down 20 percent, reducing its stake in the national carrier to about 54 percent and boosting liquidity in the stock. Since then the shares have climbed about 40 percent, buoyed by strong earnings and its dominance in the domestic market.
"Since the government sold down some time ago the share price has continued to rise to levels not seen for a very long time," said Grant Williamson, director at Hamilton Hindin Greene. "It's quite a good story for investors, and given most airlines around the world are underperforming I think it's a fair credit to Air New Zealand and does indicate the almost-monopoly they do have in the New Zealand domestic market."
Telecom rose 0.6 percent to $2.64 and was the most-traded stock, with 12.8 million shares changing hands. New Zealand's largest telecommunications provider is favoured by investors looking for exposure to New Zealand and for its 6.3 percent dividend yield, Williamson said.