NZ stocks: Investors lukewarm as interest rates fears rise

6.40pm

The New Zealand sharemarket took an early lead from a robust day on US markets, but the prospect of an interest rate rise took the edge off investors' appetites.

At the day's close the benchmark NZSX-50 was up just 0.31 points at 2369.456, after peaking at a new all-time high of 2382.872.

The NZSX-40 capital index was down 2.187 points at 2212.76. Turnover was strong, however, with 42.7 million shares worth $116 million changing hands.

Among the 144 stocks traded were 49 rises and 45 falls.

Brokers predicted trading would probably be lacklustre tomorrow ahead of Thursday's interest rate announcement.

Fletcher Building appeared to be particularly vulnerable to the effects of a possible interest rate hike on the housing market, falling 5c to 393.

It was also a bad day for retail stocks, with declines in The Warehouse, Briscoe Group and Postie Plus.

The Warehouse tumbled another 18c to 502 on $5.7 million turnover. The stock has lost nearly 9 per cent since last Thursday, the day before the company revealed its Australian companies were taking longer to turn around than expected.

Market bellwether Telecom closed 3c down at 519 on $38.6 million worth of shares. However, the stock opened 4c up at 526, reinforcing its renewed popularity even though it went ex-dividend at 5c yesterday.

"Telecom is still chugging along with good buying support," Greenslades broker Paul Valk said.

"It could be the (New Zealand) dollar with overseas parties looking for a place to park their dollars while the dollar is high."

Another leading stock, Carter Holt Harvey, climbed 7c to 187 on $6.5 million after shares in its parent company, International Paper, rose on a favourable bank re-rating.

Topping the volume was transport company Mainfreight, which gained 4c to 138 on 12.6 million shares worth $16 million.

The company today confirmed a $16 million placement of 12.62 million shares at 127c each, to help pay for its purchase of rival Owens Group. Mainfreight, which also said it was planning a $20 million rights issue early next year, owns 79.6 per cent of Owens.

Contact Energy was up 3c at 554, at one stage matching its year high of 560.

Other stocks on the rise included Auckland International Airport up 3c at 670, Cavalier up 2c at 555, Ebos up 5c at 325, Fisher & Paykel Appliances up 5c at 380, NGC Holdings up 3c at 202.

Sky City fell 9c to 455 after the company announced plans to renovate its Adelaide casino. Within that statement was news that the Adelaide casino costs were higher than expected, said Direct Broking broker Brett Wilkinson.

Others on the slide included Westpac down 35c to 1630, Briscoe Group down 7c at 162, Fletcher Building down 5c at 393, GDC Communications down 4c at 26, Postie Plus down 6c at 102, Tower down 2c at 127, and Restaurant Brands down 1c at 110.

There had been $76.8 million worth of shares traded on the New Zealand Alternative Exchange.

Overseas, the Dow Jones was up 100 points at 9882.46, the Standard & Poor's 500 Index was up 9.71 points at 1067.91, while the Nasdaq Composite Index was up 20.21 points at 1980.47.

- NZPA