NZ stocks: Telecom drags chain on heavy turnover

Telecom's slump to new lows for the year dragged the sharemarket down again yesterday.

Telecom shed 6c to $4.74 in early trade - its lowest level since November - but later recovered a cent to close down 5c at $4.75 .

That drove the NZSE-40 capital index down 3.43 points to 2059.98. Telecom accounted for around 40 per cent of heavy turnover worth $106 million.

Analysts say they are increasingly concerned that Telecom is shaping up as yet another New Zealand company to have its fingers burned through Australian investments. The company told analysts last week that it was not yet getting an economic return on its subsidiary AAPT.

Number two stock Carter Holt Harvey slipped a cent to $1.95, adding to the 2c it lost on Thursday.

Outside of the leaders, JBWere senior investment adviser Peter Stokes said stocks were trading on their individual merits as investors rejigged their portfolios in line with the results of the December/January reporting season.

"There were more positive surprises than negative surprises to come out of the last few weeks of results and so you always get that portfolio fine-tuning and that's come through in some of the stocks," he said.

Thursday's standout performer, market newcomer Briscoe Group, soared 8c to an all-time high of $1.91 during the morning session before settling up 2c at $1.85.

Briscoe on Thursday posted a January year profit of $17.5 million - well ahead of the $15.1 million forecast in its prospectus in November. The company declared a dividend of 3.25c a share, also nearly a third better than forecast.

Restaurant Brands continued its strong run after announcing a foray into Australia. It put on 6c to $2.11 in morning trade before closing up 2c at $2.07.

Others to gain included Sky City, up 4c at $5.77, The Warehouse, up a cent at $7.11, Sky TV, up 5c at $4.55, Natural Gas Corp, up 2c at $1.23, and Rubicon, up 3c at 63c.

On the downside, Fisher & Paykel Appliances shed 5c to $9.15, as did its Healthcare cousin at $10.20, Ports of Auckland was down 5c at $6.25, Baycorp Advantage fell 4c to $6.06 and Tranz Rail was a cent lower at $4.23.

Air New Zealand was steady on 33c after the airline said it was considering morphing into a discount carrier. UBS Warburg has taken a contrary view from other brokers and issued a buy recommendation on the stock.

* Demand for the New Zealand dollar eased a little yesterday but it remained well bid, tantalising analysts with the promise of another surge.

After hitting seven-month highs early this week, the kiwi eased a little to 43.88USc, slightly weaker than Thursday's close of 44.01USc.

In the short term, dealers said, the kiwi was in consolidation mode following a "pretty impressive week".

But Murray Hindley, chief forex dealer for ANZ Investment Bank, said the signs were good for another show of strength.

"We may see some small weakness back to 43.60USc but I would still be looking to buy into any dips that we see. I still think there's a chance that we can continue to see this currency push higher.

"Some technicians are now talking it into the low 45s ... over the next month or so, depending on what other data comes out."

- NZPA