Market rises, Telecom dips - recovers

The New Zealand sharemarket rose today but not as much as key markets in Asia as the share price of market leader Telecom dipped, then recovered on a government broadband announcement.

Many Asian markets posted strong gains today after US stocks rose on better-than-expected US retail sales and New York manufacturing data, and after Federal Reserve chairman Ben Bernanke said the US recession was most likely over.

The benchmark NZSX-50 index closed up 17.959 points, or 0.579 per cent, at 3117.585. As it closed the Australian market was up more than 2 per cent.

Turnover was worth $112.6 million. There were 51 rises and 33 falls among the 116 stocks traded. Telecom shares fell 9c to 259 after the Government said partners for its $1.5 billion investment in ultra-fast broadband cannot be controlled by shareholders who own retail telecommunications assets. By the close the stock was unchanged at 268.

Grant Williamson, director at Hamilton, Hindin, Greene, said the initial reaction was an over-reaction by sellers.

"Once the weak sellers were out of the way the buyers came back into the stock," he said.

Vector, which is signalling it wants to be a partner in Auckland, was unchanged at 197.

Telstra rose 15c to 398 after falling heavily yesterday on news it will have to split its wholesale and retail operations, or risk losing access to wireless broadband under draft legislation unveiled by the Australian government.

PGG Wrightson fell 2c to 72 after saying it had been notified by Silver Fern Farms of an intention to sell shares.

Tourism Holdings rose 3c to 68 as the latest Tourism Industry Monitor report said 44 per cent of those surveyed believe demand for tourism products will increase in the next three months.

Port of Tauranga fell 4c to 665, The Warehouse fell 12c to 413 and Hallenstein Glasson fell 10c to 290. Fisher and Paykel Healthcare fell 8c to 315 and Sanford fell 5c to 495.

Fletcher Building rose 22c to 818 and Contact rose 3c to 593. Cavalier rose 5c to 255 and Hellaby rose 6c to 162. Infratil rose 2c to 167. TrustPower rose 5c to 750.

Auckland Airport was unchanged at 175 as was Air NZ on 122. Nuplex rose 3c to 237 and NZ Refining rose 5c to 500. Tower rose 2c to 160.

The Dow Jones industrial average rose 56.61 points, or 0.59 per cent, to close at 9683.41. The Standard & Poor's 500 Index gained 3.29 points, or 0.31 per cent, to 1052.63. The Nasdaq Composite Index added 10.86 points, or 0.52 per cent, to 2102.64.

- NZPA