Solid start for NZ shares

File photo / Paul Estcourt

The sharemarket started the day with a solid gain, following a surge by stocks in the United States, a day after the unveiling of the Federal Reserve's plan to boost the US economy.

Despite widespread gains, Telecom slipped 2c to $2.09 early after reporting a 0.9 per cent fall in first quarter adjusted earnings before interest, taxation, depreciation and amortisation as it absorbed $16 million in new regulatory costs and faced intensifying competition. Yesterday Telecom added 5c.

Briscoe Group shares were untraded early, having closed yesterday at $1.43, after reporting a 6.5 per cent rise in third quarter sales. The company said it had a significant late rally in sales leading up to the October 1 rise in GST, but during October sales and margin tightened.

Around 10.15am the benchmark NZX-50 index was up 11.94 points to 3338.19, having a few minutes earlier reached its highest level in nearly six months around 3342.5 points, after yesterday closing down 6.8 points.

Fletcher Building lifted 10c to $8.23 early and Contact Energy lifted 7c to $5.99, after yesterday losing 9c and 8c, respectively.

Steel & Tube lifted 7c to $2.49, Mainfreight was up 6c to $7.40, Port of Tauranga gained 3c to $7.43, and Nuplex lifted 3c to $3.58.


***

In the US, stocks extended a rally that started in September to close at two-year highs.

Confounding expectations of a sell-off after the Fed's asset-buying plan, investors instead focused on the flood of cheap money expected to flow into the banking sector from the US central bank's plan to buy more Treasury debt.

Retail stocks surged after October's same-store sales data, which appeared to bode well for the upcoming holiday shopping season.

The Dow Jones industrial average closed up 2 per cent at 11,434.84, the Standard & Poor's 500 Index was up 1.9 per cent at 1221.05, and the Nasdaq Composite Index was up 1.5 per cent at 2577.34.

- NZPA