KEY POINTS:
New Zealand shares steadied today from yesterday's dramatic 2.3 per cent plunge over more international credit jitters.
The benchmark NZSX-50 index ended up 17.6 points or nearly 0.5 per cent to 3557.69 , losing a little of its earlier steam.
Turnover was a moderate $106 million , with rises and falls virtually even at 45 to 46.
ASB Securities adviser Stephen Wright said he was "pleased to see there's been no follow-on from yesterday's dismal market".
The market was "still at the mercy of overseas markets" and investors were awaiting the Reserve Bank's interest rate decision tomorrow.
Performances were "a mixed bag," particularly among the top three. Telecom rose a strong 11c to 393 after a 20c fall yesterday.
But the domestic slowdown was thought to still be dogging Fletcher Building , down 4c today to 766 following a rollercoaster 30c fall yesterday and 22c jump on Friday.
Contact Energy slid 10c to 905 after a similar trading pattern, down 33c yesterday and up 37c on Friday.
While investors may be reacting to its parent Origin Energy's rejection of a takeover offer , Forsyth Barr analyst Andrew Harvey-Green said fears of a power shortage this winter were just as likely to be having an influence on Contact's share price.
Low lake levels in the South Island are pushing thermal generation to full capacity.
"At the moment, Contact's generation is largely based in the North Island, they're receiving about $300 per megawatt for their Otahuhu and geothermal and Taranaki thermal plant.
"They're receiving a bit more for what they're running down in the South Island, but because they're having to pay $400 per MW on the demand side, that price differential is causing them problems."
Other moves today included Mainfreight up 8c to 730, Freightways up 6c to 326, PGG Wrightson up 7c to 240, Pumpkin Patch up 6c to 169, and Sky TV up 10c to 465.
Fishing company Sanford hit a year high of 480, up 5c, as the seafood industry benefits from a consistent rise in world seafood prices.
Underperformers included Diligent Board Member Services which slid 6c or 15 per cent to a fresh year low of 34c on light volume. The New York-based software company issued shares six months ago at $1.00 and issued a sales warning in late May .
Dual-listed banking stocks Westpac and ANZ enjoyed healthy rises, up 60c to 2730 and 24c to 2524 respectively.
Australia was tracking a similar recovery in late afternoon trading, up 0.3 per cent on a recovery in financial stocks.
Both Australia and New Zealand managed to shake off the overnight gloom on Wall St, where stocks eased after a report that Lehman Brothers may have to raise more capital.
Lehman denied rumours it had borrowed directly from the Federal Reserve, but its shares ended down more than 9 per cent.
The Dow Jones industrial average fell 100.97 points, or 0.81 per cent, to close at 12,402.85. The Standard & Poor's 500 Index slipped 8.02 points, or 0.58 per cent, at 1,377.65, while the Nasdaq Composite Index was down 11.05 points, or 0.44 per cent, at 2,480.48.
"People are very leery of not having to go through another Bear Stearns-type situation with Lehman Brothers," said Michael James, senior trader at regional investment bank Wedbush Morgan in Los Angeles.
"It's a fear factor thing. There may be nothing behind it, but there's a sell now, ask questions later mentality."
- NZPA
