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Soaring Auckland International Airport (AIA) shares were the highlight of a broadly positive market boosted by a hefty US interest rate cut overnight.
Other bourses also got a boost, including Australia, up 2.2 per cent, Japan up 3 per cent and Hong Kong up nearly 4 per cent as the US move eased concerns about the world's biggest economy.
The NZSX-50 index closed up 1.3 per cent or 54.12 points to 4177.64. Rises outnumbered falls 59 to 28 on 127 stocks traded with a turnover worth $110m.
"We're hoping momentum will keep going but the other cause of concern is the strength of our dollar," Stephen Wright, head of advisory at ASB Securities, said, referring to a US3c rise in the New Zealand dollar since yesterday.
Currency sensitive stocks included Pumpkin Patch down 4c to 330, Fisher & Paykel Healthcare, down 2c to 353, and Air New Zealand, down 4c to 220.
About a third of the volume was in Telecom which rose 2c to 432.
The star performer was Auckland International Airport, which jumped 26c or 8.5 per cent to 330 after the Canada Pension Plan Investment Board confirmed it intended to seek a significant minority stake.
It will put forward three options include an all-cash option of $3.70 per share, and two others which would be a mix of cash and shares worth up to $3.90 a share.
The stock was trading at a discount possibly because CPPIB "is not after 100 per cent" and because the terms of the deal would not be known until tomorrow at the earliest, Mr Wright said.
Infratil, which with the NZ Super Fund collectively owns a 6.2 per cent stake in AIA, rose 9c to 290.
The NZX itself lost 5c to 990 after Ithaca Custodians, a subsidiary of GPG, sold its 1.6 per cent stake in the stock exchange, at $9.50.
The Warehouse put on 5c to 605, continuing its climb as it approaches a special dividend payout on Monday.
Mainfreight, which yesterday announced a major offshore acquisition, closed down 5c to 705.
Fletcher Building which made a big gain yesterday, added another 12c to 1211 today.
Other moves included Contact Energy, up 21c to 912, Michael Hill up 17c to 1130, Westpac up 34c to 3204, and ANZ Bank up 41c to 3351.
On Wall St, stocks jumped more than 2 per cent on Tuesday after the Federal Reserve move raised hopes the economy could ride out a prolonged housing slump and turmoil in the credit market.
"In this case, I think the Fed was just trying to make a point, to create some liquidity and ease things for everybody from the consumer to the guy trying to sell his house," Warren Simpson, managing director at Stephens Capital Management in Little Rock, Arkansas, said.
The Dow Jones industrial average was up 251.02 points, or 1.87 per cent, at 13,654.44. The Standard & Poor's 500 Index was up 31.49 points, or 2.13 per cent, at 1508.14. The Nasdaq Composite Index was up 51.60 points, or two per cent, at 2633.26.
- NZPA