NZ stocks: Shares close higher on Wall Street rally

The New Zealand sharemarket put on a solid show yesterday, taking heart from a rally on Wall St.

The benchmark NZSE-40 index closed up 24.48 points, or 1.20 per cent, at 2069.12 on turnover worth $48 million.

The tone was set by Wall Street which snapped back from a dismal losing streak in eight of the last 10 days.

Reports showing growing manufacturing activity and resilient US consumer confidence revived hopes of an economic turnaround after a long string of selloffs.

The Dow Jones industrial average rallied 126.35 points, or 1.29 per cent, to 9946.22, while the technology-loaded Nasdaq Composite Index rose 31.30 points, or 1.89 per cent, to 1688.23.

Setting the scene locally were market heavyweights Telecom and Carter Holt Harvey.

Telecom added 6c to 488 while Carter Holt was up 5c at 185 after a strong showing by its US-based parent International Paper overnight Tuesday

"It was comforting to see us mirror the positive night on Wall St but I think they're far from out of the woods there," ASB Securities dealer Andrew Kelleher said.

"The Dow Jones index didn't get back over 10,000 -- that's a psychological level -- and we'll have to watch it closely over the next couple of days to see if it can hold onto the gains made yesterday."

Air New Zealand continued to gain altitude, adding a further 7c to 56c. The stock has gained a mighty 47 per cent since Friday on an improved profit forecast, an upbeat UBS Warburg report and full inclusion in the NZSE-40 index from yesterday.

Contact Energy was up 2c to 404 ahead of its half year result to March, due out at 9amthis morning. The power company is expected to post a profit in the realms of $33 million to $37.4 million.

Both Contact and Carter Holt may have benefited from the Government's announcement on the Kyoto protocols on greenhouse gas Tuesday. Although a carbon tax will be introduced in 2007, the provisions were milder than had been feared by business.

On the flipside, NZ Refining fell 6c to 1694. The Government's policies could cost the Marsden Point Oil Refinery $25 million a year in carbon tax. A tax of $25 for each tonne of carbon emitted would be imposed.

In other moves, Auckland International Airport rose 7c to 437, Briscoe Group was up 3c at 210, Ports of Auckland added 5c to 625, Rubicon was up 2c at 59c, Waste Management rose 4c to 274, BIL International was a cent higher at 52c, Fisher & Paykel Healthcare jumped 10c to 945 and The Warehouse was 4c higher at 740.

Baycorp Advantage, which has been savaged this year, rose 14c to 490 and Tranz Rail added 10c to 385 after saying Tuesday its Tranz Metro Wellington regional train network may not go to the auction block.

Another stock to have taken a beating, Advantage Corp, was up 3c to 39c. LateTuesday, a family trust of Nick Gordon, a director and one of the company's founders, bought 11.5 million shares in the company controlled by a company controlled by entreprenuer Eric Watson.

On the downside, Fletcher Building lost a cent to 282, Sky City was 3c lower at 612, Independent Newspapers closed down 5c at 370 and United Networks was 3c lower at 808.

Rises outpaced falls by 54 to 35 among the 127 stocks traded.

- NZPA