NZ stocks: Telecom rebounds from six-year lows

Telecom led the way in a quiet pre-Christmas sharemarket yesterday, following the Government's release of a toned-down set of changes to the telecommunications industry.

Telecom - which had fallen to six-year lows on the local market ahead of yesterday's release - rallied to close up 7c at $5.20, on the back of a report perceived by brokers as a fairly tame outcome from the ministerial inquiry.

"The recommendations were not as harsh as the market was expecting," said Shane Gavegan, of Deutsche Securities.

"It became a bit of a case of sell the rumour and then buy the fact because in this case the market really rallied after it came through."

The benchmark NZSE-40 closed up 9.41 points at 1929.67 on modest turnover of $86.47 million.

Mr Gavegan said the market was slightly muted after the Nasdaq fell 4.3 per cent overnight in the wake of the US Federal Reserve's decision to leave the wholesale rate unchanged at 6.5 per cent, where it has been since a half-percentage point rise in May.

"Greenspan saying that there is a recession risk probably scared the market," Mr Gavegan said. "It does look fairly shaky for the US market over the next little while and those jitters are going to flow down this way."

In other movements, Fisher & Paykel closed down 16c at $8.10, following Tuesday's record 66c rise on the back of an announcement that it was splitting its healthcare and appliance divisions.

Fletcher Energy was down 13c at $8.35 amid further strength in the kiwi and weakness in the Nasdaq-listed Capstone Turbines. The kiwi climbed to nearly 43.50USc in late trading.

Fletcher Forests picked up 1c to 30c, while Building gained 5c to $1.94.

The Warehouse also rallied 15c to $5.90. The company said after the market closed that it had entered into a partnership with eVentures to provide IT support and management, as well as offline advertising and promotion, to a new Business to Consumer (B2C) unit of eVentures subsidiary E-loan.

Warehouse chief operating officer Greg Muir said the market had been aware that the company was considering financial services in addition to its current credit card offering.

Other stocks to gain were INL, which closed up 18c at $3.30, SkyTV, up 5c at $8.05 and AMP, which gained 34c to $25.25.

Stocks to lose ground included Air NZ B shares, down 5c at $2.05, Contact, down 4c at $2.69 and Carter Holt, down 3c at $1.67.

- NZPA