KEY POINTS:
The New Zealand sharemarket started the week solidly, after US stocks ended last week by soaring.
But there was selling into the early rises and many top stocks finished off their highs. Exporters continued to get a lift from the lower New Zealand dollar.
The benchmark NZSX-50 index rose 12.37 points to 3370.19, having lost 21.1 points on Friday. There were 68 rises and 24 falls and turnover was worth $126 million.
Telecom closed down 4c at 336 as investors assessed US hedge fund Elliott International's bid for board seats as a long shot.
Elliott is putting up two candidates at the annual meeting, arguing the company has an outdated strategy.
Stephen Wright at ASB Securities said a 3 per cent shareholding was not enough get two board seats and the move would be a distraction for the company's new managers.
"Telecom started strongly as you would expect when markets are better," he said. But there was selling into rallies in large stocks.
Telecom reported its operating surplus from continuing operations fell 15.5 per cent to $713m for the year to the end of June.
Fletcher Building fell 12c to 657. The company is expected to report lower earnings but again the focus will be on what it says about the outlook for the property market and profits.
"Obviously Fletcher Building has already been hit by the market," said Mr Wright.
Sanford rose 24 to 598 because as an exporter it is expected to benefit from a lower New Zealand dollar. The New Zealand dollar was again testing US70c today.
Fisher & Paykel Appliances rose 5c to 216, F&P Healthcare lifted 8c to 299 for the same reason.
Rakon continued a recent run higher, rising 2c to 304, but was off its best levels.
Guinness Peat Group rose 1c to 156 after announcing the sale of its Tower Australia stake last week. Tower NZ rose 4c to 220.
Contact fells 1c to 869.
Lion Nathan rose 14c to 1100, SkyCity rose 5c to 375 and SkyTV rose 1c to 475.
US stocks soared on Friday, rounding out their best week in more than three months, as the plunge in oil eased inflation concerns and improved prospects for business and consumer spending.
The Dow Jones industrial average rose 2.65 per cent to 11,734.32, while the Standard & Poor's 500 Index jumped 2.39 per cent to 1296.32. The Nasdaq Composite Index gained 2.48 per cent to 2414.10.
For the week, the Dow gained 3.6 per cent, the S&P 500 advanced 2.9 per cent and the Nasdaq shot up 4.5 per cent. It was the best week for all three indexes since April 20.
- NZPA