NZ stocks: Brisk start to NZSE trading, CHH enjoying surprise rise

12:30 pm

A surprisingly brisk start to the day's trading was keeping brokers on their toes, with the biggest surprise being Carter Holt Harvey.

Just after 11am the turnover was $29.8 million after a disappointing night on Wall Street, and the market was "doing pretty well this morning," Greg Arnott of DF Mainland noted.

CHH yesterday announced a net half year loss of $19 million, and a International Paper Co, also announced a sharp drop in profit over costs and low log prices. Carter Holt Harvey was trading down a cent at 155, but the stock was showing signs of some aggressive buying, particularly by one broker.

"It's holding its own very well, given the news yesterday so it could be a perception that the news is on the table, clean slate and the cyclical viewpoints coming into play," Mr Arnott said.

In late morning trade, the NZSE-40 capital index was down 14.64 points to 1907.25.

Contact Energy, a focus of the market since a takeover bid was announced by its parent company last Friday, was steady at 398.

Telecom lead the market down this morning, dropping 5c to 431.

Mr Arnott said the stock had been overlooked by investors charmed by more interesting stocks, but the telco was still a good buy, and he thought it might have been suppressed by questions over the direction of its future growth.

Auckland Airport was down 5c to 322 after receiving a couple of brokerage downgrades, possibly based on its reliance on Air NZ and concerns about tourism growth.

Other falls included Sky City down 10c to 1120, The Warehouse down 9c to 628, energy company Horizon was down 25c to 1275, Independent News Ltd was down 15c to 325, Infratil was down 7c to 161, and Pyne Gould Guinness down 2c to 127. Lion Nathan was down 1c at 539 on $2.8 million of shares.

But beverage maker Frucor was up 4c to 184 after being named by Forbes Global magazine as one of the world's top 20 best small businesses.

Mr Arnott said another fall on the Dow would likely see more New Zealand stocks ease tomorrow.

Anthrax fears and worries about the economy were blamed for spooking the US market overnight, prompting a fall on the Dow of 151 points or 1.61 per cent to 9232.97.

Technology shares in particular took a beating, with the Nasdaq slumping 75 points or 4.4 per cent to 1646.36, its biggest drop in percentage terms since April 23.

The broader Standard & Poor's 500 Index dropped 20.45 points, or 1.86 per cent, to 1,077.09.

The market got an initial boost after computer giants IBM and Intel Corp posted solid results, but news congressional buildings will be screened for environmental hazards amid deepening fears of biological warfare quashed the rally.

- NZPA