NZ stocks: INL 20 per cent rise lifts top-10 index

12.00pm

Independent Newspaper shares' sharp rise when they resumed trading this morning lifted the top-10 index in the process.

At mid-morning INL shares were up 20 per cent, or 66c, at $4.04 after announcing yesterday the company had agreed to sell its newspapers to John Fairfax Holdings for $1.19 billion, subject to shareholder approval.

INL's 66 per cent-owned pay television asset Sky Network Television has risen 10.8 per cent during INL's trading halt and was down 1c at 404 today.

The top-10 index rallied sharply this morning, up 1.02 per cent to 898.9, while the benchmark NZ50 gross index was up 0.53 per cent, or 10.47 points, at 1992.19.

Leading light turnover of 13.80 million stocks valued at $26.74 million was Telecom's $5.93 million.

Alan Wills of Forsyth Barr Frater Williams said INL's shares were trading between 400 and 420, as expected.

"Now we have the terms of the heads of agreement on the sale of the publishing assets, obviously all the attention now is what the next step is going to be," Mr Wills said.

"The market's saying, they're going to get so much cash back, all it's got left is its shareholding in Sky. The share price now reflects the value of the cash they're getting for the publishing assets, plus its holding in Sky."

Telecom, also a shareholder in INL and Sky, was down 3c at 470 "but I wouldn't read too much into that, it's had a nice run in the last couple of days", Mr Wills said.

"Either way, it's good for Telecom."

On the down side, Tranz Rail lost a further 5 per cent today to 64, just above yesterday's fresh low of 62.

Ratings agency Standard & Poor's said yesterday it had downgraded the company to B-minus, which Moody's followed with a one-notch downgrade to B2.

The shares have dived more than 25 per cent since Tranz Rail issued a profit warning a week ago and speculation is rife it will look to the Government for help.

"(Tranz Rail's) still a problem, the market's just working through that at the moment, but it's a shame," Mr Wills said.

"There's been a lot of volume in Tranz Rail already (7.1 million shares)."

Elsewhere on the market, Auckland International Airport was up 2c at 514 in what has been volatile trading.

"It tends to fluctuate daily on what people think about the Sars (severe acute respiratory syndrome) problem. If the Sars problem went away, now there seems to be some clarity on the war (in Iraq), that share price could react quite strongly," he said.

Baycorp Advantage rose 3c to 164, Fletcher Building gained 2c to 325, Briscoe Group was up 4c at 197, The Warehouse rose 6c to 532, and casino company Sky City rose 7c to 822.

Fisher & Paykel Appliances rose 10c to 1080, and its sister stock Healthcare gained 4c to 1048.

Air New Zealand lost 1c to 43, Contact Energy was down 3c at 466, Restaurant Brands shed 4c to 145, and Lion Nathan fell 5c to 595.

There were 39 rises and 24 falls on the 113 stocks traded.

On Wall St, the Dow Jones industrial average shot up 147.76 points, or 1.81 per cent, to 8351.52; the broad Standard & Poor's 500 added 16.89 points, or 1.95 per cent, to 885.20; and the Nasdaq Composite Index gained 26.10 points, or 1.92 per cent, to 1384.95.

- NZPA