NZ stocks: Storming CHH leads sharemarket to new high

12.04pm

A surging Carter Holt Harvey led the sharemarket to a fresh all-time high this morning, according to the NZSX-50 index.

The benchmark NZSX-50 gross index was up 17.27 points, or 0.68 per cent to 2565.03 at 11.35am this morning, while the NZSX-40 capital index rose 13.96 points, or 0.61 per cent to 2316.11.

CHH stormed up 10c, or 4.72 per cent to 222, after peaking earlier in the morning at a four-year high of $2.28.

Carter Holt Harvey (CHH) announced yesterday it had sold its tissue business and an associated joint venture for just over $1 billion -- far outstripping market expectations.

"Probably what it indicates is that it's difficult to value forestry assets. The true value of some of these assets is not reflected in share prices generally and only when it comes to a corporate issue like this do we get a feel for the intrinsic value," said Matt Willis of ABN Amro. Mr Willis said the stock seemed to be settling around the $2.22 level.

"Once the market digests the impact of that sale, given that it's a one off and they don't get to enjoy the earning streams from that business any more, the stock will start trading on fundamentals," he added.

CHH accounted for $11.8 million of the market's early turnover of $39.1 million. Top stock Telecom had turnover worth $12.2 million by 11.35am.

Telecom was down 1c at 579, after yesterday's news that the Commerce Commission had filed High Court proceedings against the company.

The consumer watchdog alleged Telecom misused its market power to deter competition in high speed data transmission.

Wood processor Tenon, formerly Fletcher Challenge Forests, was up 3c at 143.

Today is the record date for the company's 62.5 cents per share capital return to shareholders resulting from the sale of much of its forests. Payment date is expected around March 31.

Other stocks on the rise this morning included Contact Energy up 4c at 532, AMP up 16c at 642, Waste Management up 3c at 443, Sky City Entertainment up 5c at 445, Nuplex up 3c at 454, Auckland International Airport up 5c at 642, Fisher & Paykel Appliances up 3c at 430, F&P Healthcare up 5c at 1175, Fletcher Buildings up 3c at 440 and stock exchange operator NZX up 12c at 852.

On the downside, The Warehouse slipped 1c to 433, Sanford was down 10c at 490, GRD down 10c at 210 and Taylors Group down 5c at 270.

Of the 109 stocks traded by 11.35am, there were 48 rises and 21 falls.

- NZPA