NZ stocks: Sharemarket quiet, fallers outnumber risers

12.05 pm

The New Zealand sharemarket looked likely to remain fairly quiet today, with few drivers apparent and Wall Street stuck in a holding pattern.

By mid-morning the NZSE-40 capital index was down 5.91 points, or 0.29 per cent, at 2031.36, on turnover of 6.69 million stocks valued at $24.88 million.

Topping turnover was Telecom with $14.10 million worth of stocks trading hands.

Peter Stokes of JB Were said Telecom, down 6c at 506, appeared to have some resilience just above the 500 mark, but little momentum to drive it much above that.

Next week Telecom is expected to post an increased net profit for the year to June. Analysts on average picked a net tax paid profit around $828 million, including a net $221 million dividend from its share of the Southern Cross Cable network.

Last year Telecom, which carries a 23 per cent weighting on the NZSE-40 capital index, made a net profit of $783 million.

Baycorp drifted off today, losing 20c to 1330 by mid-morning on profit-taking.

"Perhaps some people are taking the view that it's priced to perfection on the back of the announcement (a merger with Data Advantage) - it was well signalled and perhaps they've just run to a level that's pulled out a few profit-takers," Mr Stokes said.

"It's not a surprise really."

The sharemarket was quiet at the moment because of several factors, including static interest rates, and Wall Street in a tight holding pattern.

"Then we've gone the best part of six months without some profit figures - we're just moving into that season now, so we're going to get some local focus from that," he said.

"There are just no real direction drivers out there.

"Also, a lot of the stocks that looked quite good at the beginning of the year - Baycorp, Fisher & Paykel, Ports of Tauranga, Ports of Auckland, Fletcher Building - some of these stories that looked too cheap have now got to a level I believe the market feels is fairly priced. Not necessarily fully, but fairly - they're in that middle-ground."

On the market, Air New Zealand domestically-held A shares gained 3c by mid-morning to 113, Contact Energy rose 1c to 323, Fisher & Paykel was up 10c at 1280, Ports of Auckland gained 5c to 570 and TrustPower was up 10c at 330.

Rumours have filtered through the market that Contact Energy had approached Tauranga-based TrustPower shareholders about a takeover offer for the retail side of the business.

Brierley Investments was up 1c at 61, TrustPower investor Infratil was up 2c at 171, and The Warehouse gained 1c to 555 after reasonably strong retail sales figures released yesterday.

On the down side, Fletcher Building lost 1c to 264, Independent Newspapers was down 6c at 356, casino operator Sky City shed 10c to 1115.

Tranz Rail shed 5c to 415, Telstra lost 1c to 639 and electricity network business Horizon Energy shed 17c to 1120.

There were 40 falls and 23 rises on the 105 stocks traded.

On Wall Street, the Dow Jones Index closed down 165.24 at 10,293.50, or 1.6 per cent, its lowest close in 11 sessions.

The suffering was even more pronounced in technology, sending the Nasdaq composite index down 61.43 to 1966.36, and the Standard & Poor's 500 index slipped 20.87, or 1.7 per cent, to 1183.53.

- NZPA