NZ stocks: Genesis stands out in buoyant trading

The sharemarket responded positively to news that the US Federal Reserve had cut interest rates.

"The market had a healthy tone to it," Credit Suisse First Boston dealer David Price said.

The benchmark NZSE-40 closed up 7.02 points at 2014.97, followed closely by the NZSE-10, up 4.86 points at 900.50.

The Federal Reserve slashed key US interest rates by half a percentage point, saying the nation's economic slowdown required a "rapid and forceful response" and signalling it would do more if needed.

The action, which was widely expected by financial markets and followed a surprise half-percentage point rate cut earlier this month, took the bellwether fed funds overnight bank lending rate to 5.5 per cent from 6 per cent, and erased all the rate increases of 2000, when the economy was still booming.

Mr Price said the local market had viewed the decision as positive for New Zealand - a sign that local stocks could well outperform many of their overseas cousins in the coming months.

"New Zealand, I would say, will be a very strong performer this year relative to other markets," he said.

Turnover totalled 31.36 million shares valued at $88 million. Fletcher Energy made up the lion's share, with 2.68 million Energy shares worth $24.16 million changing hands. The stock closed up 9c at $9.07.

Fletcher Building was also strong, up 8c at $2.10.

Biotechnology company Genesis, headed by founder and chief executive Jim Watson, added a massive 60c to $7.80 following Wednesday's announcement that the company had beaten back forecasts of a $9.9 million loss, to post a net profit of $723,000 for the year to December 31. The company has also been buoyed in recent days by speculation that it is about to announce positive results on its psoriasis treatment, PVAC.

Whiteware and healthcare product manufacturer Fisher & Paykel was another star performer, up 19c at $8.14.

Mr Price said the market's positive tone had enticed investor interest back into second-level stocks such as NZ Refining and Sanford. NZ Refining added 20c to $15.50, while Sanford was up 25c at $5.25.

Bellwether stocks Contact Energy and Carter Holt Harvey also gained. Contact added 5c to $2.89 and Carters was up 2c at $1.60.

Sky City was up 5c at $8.95, while Sky TV was up 14c, buoyed by a stronger kiwi.

The kiwi was at 44.62USc at around 5 pm, from 43.95c at Wednesday's close, after taking advantage of the further interest rate differential presented by the Fed's rate cut.

Telecom was hit by a spot of profit-taking following its recent run up, ending the day down 4c at $5.78. Auckland Airport also lost ground, down 6c at $3.37.

Fletcher Forests preference shares topped turnover but their price was unchanged at 32c.

In all there were 44 rises and 41 falls among the 141 stocks traded.

- NZPA