Modest lift for NZ shares

The New Zealand sharemarket made modest gains in early trade, after firm rises in Europe and Asia, while Wall Street was closed for the Labor Day public holiday.

Investors also received something to be mildly hopeful about yesterday from Treasury.

In its monthly economic indicators, Treasury said there were signs the housing market and the wider economy was beginning to grow again and that unemployment would not reach 8 per cent as earlier predicted.

Despite the slightly more optimistic outlook, Treasury warned the return to economic growth might not be sustainable.

It pointed to a resurgence in interest-free deals for consumer durables, and said economic growth fuelled through householders borrowing money would not unwind imbalances in the economy.

Around 10.20am today the benchmark NZX-50 index was up 4.74 points to 3127.43, after rising 24.4 points yesterday.

Among leading shares, Fletcher Building continued its recent rise early, up 3c to $7.98 on top of a 9c gain yesterday. Contact Energy lifted 3c early to $6.18, while Telecom was down 1c to $2.77.

Nuplex lifted 5c early to $2.40, NZ Refining Co was up 5c to $5.00, Freightways gained 4c to $3.01, and The Warehouse added 3c to $4.00.

Sky TV was down 3c early to $4.42, while Hellaby Holdings lost 5c to $1.45 but on low volume.

In Europe, stocks closed higher, extending gains after a massive takeover bid by Kraft Foods for British rival Cadbury signalled a further return to normality in the markets.

In London, the FTSE 100 index of leading shares jumped 1.7 per cent, while in Frankfurt the DAX added 1.5 per cent.

- NZPA