KEY POINTS:
The sharemarket temporarily shrugged the bear off its back today despite another scary day on Wall Street.
The market was initially affected by bearish sentiment in the US where the Dow fell another 0.8 per cent and closed below 11,000 for the first time in two years as
investors fretted about the US plan to rescue mortgage finance companies Freddie Mac and Fannie Mae.
The benchmark NZSX-50 index in the morning fell 40 points - over 1 per cent - with a new three-year low of 3001 touched.
But around midday it started to turn thanks to buying in top stock Telecom and No 2 Contact Energy. The index, which has lost 16 per cent since the start of June, closed up 19 points, 0.6 per cent, at 3059.
"It ran out of selling and the aussie market didn't collapse," said Forsyth Barr broker David Price.
Volumes were still "pitiful" and there were actually more red down arrows on the screen than green ones. Without Telecom and Contact, the index would have been again down sharply.
"There is a distinct lack of interest," Mr Price said.
But some stocks were judged to be oversold, including Telecom, which rose 7c to 338.
Contact Energy, recovered 26c to 740 from its recent battering. It had been heavily sold after Britain's BG Group said that, should it win between 50 and 90 per cent of Contact's 51 per cent owner Origin Australia, it would distribute those shares of a pro rata basis to Origin shareholders.
Because most of those are Australian and cannot access Contact imputation credits, brokers expect they would sell their Contact shares.
Fellow power company Trustpower fell 13c to 752 on very slim volume and as wholesale prices fell sharply due to rain in the hydro lake areas.
NZ Oil & Gas fell 8c to 171 following a steep fall in oil prices.
Sky City, which on Monday confirmed its profit guidance, rose 2c to 198.
Exchange operator NZX fell 25 to 670, possibly reflecting the light trading volumes of the bear market.
Freight companies fell amid talk domestic freight volumes were falling rapidly. Mainfreight dropped 1c to 632 and Freightways 5c to 195.
NZ Farming Systems was off 7c to 178 while its parent PGG Wrightson was down 10c to 240.
Badly battered banking stocks recovered a bit today, with ANZ up 67c to 2252 and Westpac up 78c to 2445.
Lion Nathan rose 14c to 1076.
The rise of the kiwi dollar saw Rakon fall 5c to 260 and Fisher & Paykel Healthcare 4c to 223. However, Fisher & Paykel Appliances rose 3c to 198.
Among the small stocks, Dorchester Pacific fell 2c to 21c while Sealegs fell 3c to 36c.
Gold miner, Oceana Gold, which is having problems with protests against its Philippines mine, was down 8c to 117.
Restaurant Brands fell 5c to 74c.
- NZPA