Global bounce sustains local rally

Sluggish US economic reports help lift spot gold price from lowest level since 2010 Oceana.

Gold rose 4.5 per cent to $1.40 after US economic data.
Gold rose 4.5 per cent to $1.40 after US economic data.

New Zealand shares extended their rally from a three-month low earlier in the week as stock markets around the world recovered on the prospect of slower US growth tempering optimism for higher interest rates. OceanaGold led gainers.

The NZX 50 rose 23.35 points, or 0.532 per cent, to 4416.96. Within the index, 30 stocks rose, 13 fell and seven were unchanged. Turnover was $148.9 million.

The local bourse followed stocks higher across Asia, with Australia's S&P/ASX 200 index up 1.8 per cent in afternoon trading, Hong Kong's Hang Seng up 1.6 per cent and Japan's Nikkei 225 index rising 2.3 per cent.

"Economic data out of the US reminded people the central bank won't completely step away just like that," said Mark Lister, head of private wealth research at Craigs Investment Partners. "We've seen Asian market bounce today, though New Zealand is not as strong as some other Asian markets."

OceanaGold rose 4.5 per cent to $1.40, having sunk to the lowest level since October 2009 on Wednesday.

Spot gold rose from its lowest levels since 2010 after weaker-than-expected US economic data stoked demand.

Telecom, among stocks that draw offshore interest because of their liquidity and dividend yield, rose 1.8 per cent to $2.32. Xero resumed its advance, gaining 3.6 per cent to $15.95, though volume was only 58,772 shares.

"Heading into the end of this quarter, you find the market is basically flat. We've come off reasonably unscathed, with Australia down 4 or 5 per cent in the three-month period," Lister said.

A2 Corp rose 3.2 per cent to 64c after the Government announced a review of the infant formula rules after lobbying by some of the biggest marketers. A2 has a contract with Canterbury processor Synlait Milk to make infant formula for Asian markets.

Hallenstein Glasson Holdings rose 2.5 per cent to $4.92, Michael Hill International rose 1.6 per cent to $1.30. Restaurant Brands New Zealand rose 0.7 per cent to $2.76 ahead of its annual meeting in Wellington today.

Nuplex Industries rose 2.1 per cent to $2.94 and Skellerup Holdings rose 0.8 per cent to $1.31.

Smiths City rose 10 per cent to 6c after announcing it had boosted annual profit by more than a fifth as a strong rural sector underpinned gains in the South Island.

Fletcher Building rose 0.5 per cent to $8.45.

Chorus fell 0.9 per cent to $2.28. The network operator will have to pay $6.4 million for its share of the annual levy to fund commercially non-viable telecommunications services.

- BusinessDesk

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