NZ stocks: Shares build small gains on yesterday's record close

1.00pm

After faltering initially, the sharemarket tentatively built on yesterday's record close in morning trade today.

By midday the benchmark NZSX-50 gross index was up 2.98 points to 2746.65, while the NZSX all capital index was up 1.12 points to 923.26.

"The market's held in pretty well," said Amro Craigs Equities retail adviser Nigel Scott.

An "overflow of buying" and anticipation of "a raft of good results" from the upcoming reporting season were contributing to the market's firm tone.

But top stocks had mixed fortunes this morning.

Number two stock Carter Holt Harvey was down 5c to 214 by midday as investors showed their disapproval of the company's second half result.

The result included a $440 million gain from the sale of its tissue division. The forest products company posted a fall in its second quarter net profit to $58m from $68m a year earlier.

"The first numbers looked a little bit weak but other issues surrounding Carter Holt are in people's minds," Mr Scott said.

He said investors may have been looking for some progress on the company's forest sale plans.

Market leader Telecom was up 2c to a fresh 12 month high of 610. This morning it was reported Telecom's Australian subsidiary AAPT will soon announce a "3G" mobile phone service in that country.

That would make AAPT only the second company to offer 3G in Australia. AAPT owns 20 per cent of Australian 3G pioneer Hutchison.

Contact Energy was up 4c to 592, strongly recovering from the disappointing 567 price paid by Australia's Origin Energy for control.

The market was viewing the sale positively, Mr Scott said.

"The market is just looking what the new shareholder can add."

Elsewhere by late morning: Fisher & Paykel Healthcare was up 5c to 1325, Fletcher Building was down 2c to 485, Independent Newspapers was up 6c to 465, Michael Hill was up 7c to 605, Oceana Gold was up 10c to 92, Pumpkin Patch was up 5c to 159, and The Warehouse was up 5c to 424.

Total turnover by late morning was $58.53 million and there were 38 rises and 26 falls among the 119 stocks traded.

In the US, stocks fell with technology names driving the retreat from an early rally, as fears about slowing growth in the economy and corporate profits overshadowed upbeat earnings from companies like Motorola Inc.

The Nasdaq Composite Index fell 42.70 points, or 2.23 per cent, to 1874.37, according to the latest data. The Dow Jones industrial average dropped 102.94 points, or 1.01 per cent, to close unofficially at 10,046.13. The Standard & Poor's 500 lost 14.79 points, or 1.33 per cent, to 1093.89.

- NZPA