NZ stocks: Shares ease in thin holiday trade

New Zealand shares edged lower today in a market thinned by holidays in Auckland and Australia.

The benchmark NZSE-40 index ended down 5.99 points at 1995.19 on slim turnover, even for a Monday, of $44 million.

"It's a bit quiet out on the streets today," Forsyth Barr broker Suzanne Kinnaird said.

Market heavyweights Telecom, Contact and Fletcher Building put a downward influence on the index, with Telecom down 3c at 456, Contact off 2c to 403 and Building down 3c to 340.

The market's tone was not helped by Wall Street's poor day on Friday where stocks tumbled to their lowest levels since October as the spectre of a US war against Iraq loomed over a market already spooked by the outlook for corporate profits during the rush of reporting season.

"I think our market performed relatively well considering the big fall in the States. There is a lot of nervousness out there as to what is going to happen in the Middle East," Ms Kinnaird said.

Tranz Rail had a journey as erratic as some of its recent train rides. Initially, it piled on 6c or 4 per cent to 146 - its highest since late November . It then backtracked to a low of 133 before closing up 3c at 140.

The share price has slumped from $4 at this time last year after a slew of bad news. It hit an all time low of 92c in December.

Ms Kinnaird said speculation was mounting that the Government may look to bail out the ailing rail operator.

The Sunday Star Times reported yesterday that Cameron & Co, the merchant bank which advised the Government on a rescue bid for Air New Zealand, was "doing the numbers" on the viability of a takeover of Tranz Rail.

Prime Minister Helen Clark last week put a gagging order on her ministers after Transport Minister Paul Swain sent the share price soaring by saying the Government was willing to pay a "reasonable" price for Tranz Rail's track network.

Ms Kinnaird said there was an amount of cynicism towards the latest rumours.

"With Air NZ it was critical. The company was not going to be around if they didn't do something. Whereas with Tranz Rail it's not in a particularly brilliant position but it's certainly not got the problems that Air NZ had... it's still sound from an operating perspective," she said.

Carter Holt Harvey was steady at 181 ahead of its result on Wednesday. The stock, which had been in revival, fell 3.2 per cent last week as analysts downgraded their estimates for the forester's fourth quarter result to $60 million including restructuring charges of $24 million for redundancies at its Kinleith mill.

AMP's dire run continued, sliding another 16c to new record lows of 1034.

Goodman Fielder, which is speculated to be seeking alternatives to the Burns Philp bid, was up 1c at 188.

Fisher & Paykel Healthcare, which gained 18c on Friday on the coat-tails of a good result by rival US firm Respironics, gained another 9c to to 1005 today.

Among other movers, Sky City Entertainment, rose 23c to 890 - a fresh all time high, Independent Newspapers fell 10c to 313, The Warehouse eased a cent to 710 and Sky TV was down 5c at 370.

Falls outnumbered rises by 55 to 24 among the 114 stocks traded.

- NZPA