NZ stocks: Shares climb 1.7pc

Shares hit a five-week high today, joining a global equities surge after the US government unveiled measures to help put a floor under the recession.

The Obama administration detailed a plan to purge toxic assets from bank balance sheets, fuelling optimism about a revival in US bank lending and driving double-digit gains in financial shares.

In New Zealand, the NZSX-50 index closed up 43.91 points, or 1.7 per cent, at 2635.3, having earlier risen above 3 per cent. Turnover totalled $114.1 million.

The market slipped 7 points yesterday.

While most top-50 stocks gained ground today, top stock Telecom lost a cent to 231.

"It doesn't seem to have found the interest, so I guess in that respect the buying interest in our market's probably more localised - otherwise you would have seen a lot more money going into Telecom and you would have seen them rise today," said ABN Amro Craigs senior dealer Bryon Burke.

There had been some renewed, albeit cautious, retail buying interest across the market, Mr Burke said.

Investors were weighing up their equities exposure with an eye to improving markets, although current gains were still considered a bear market rally.

At least one quarter's improvement was needed before the market direction could be considered changed.

Contact Energy was up 12c at 602, Fletcher Building gained 19c to 629, Auckland Airport rose 3c to 173, Fisher & Paykel Healthcare was up 2c at 312, and F&P Appliances rose 2c to 39.

Among the larger gains, resins maker Nuplex was up 15c at 68, The Warehouse rose 12c to 365, Port of Tauranga gained 20c to 505, and NZX was up 50c at 660 on light volume.

Tower gained 6c to 132 after raising nearly $82m in its five-year bond issue, Mainfreight was up 19c at 410, Freightways rose 8c to 287, and Ebos was up 10c at 485.

Only three top-50 stocks declined - Telecom, seafood exporter Sanford (down 14c at 560) and jeweller Michael Hill (off a cent at 52).

Australia's S&P/ASX 200 Index gave up earlier gains but was still 0.8 per cent higher at 3576, while Japan's Nikkei share average was up 1.4 per cent.

Dual-listed stocks notched up some solid gains with ANZ up 90c at 1930, Westpac up 65c at 2365, AMP 36c higher at 575 and Lion Nathan up 34c at 984.

In the US, the S&P 500 and the Dow industrials posted their biggest one-day percentage gains since late October after Wall Street finally got what it was asking for: relief for the battered banking sector and more data suggesting the housing market could be on the mend.

- NZPA