NZ stocks: Telecom the big winner in solid trading

The sharemarket posted a solid performance yesterday despite annual inflation coming out above forecasts and hitting a five-year high of 4 per cent.

The market was steady before the consumer price index announcement, and held there until late afternoon, when, led by Telecom, it jumped ahead.

"Overall, you'd have to say it was a pretty solid sort of day," said ABN Amro broker Nigel Scott.

The NZSE-40 capital index closed 9.32 points up at 1968.50.

The top 10 index gained 8.78 to 874.99 and the small stocks index 16.06 points to 5154.49.

Turnover was worth a hefty $203.6 million, and Mr Scott said it appeared some "mum and dad" investors who had been paid out of Fletcher Energy were reinvesting.

The main beneficiary was Telecom, now 20 per cent up from its six-year low of $4.57 at the start of the year.

It topped turnover at $55.8 million and closed 9c up at $5.49.

Its run contrasted with Australian telco Telstra, which fell 12c to $8.49.

Turnover was boosted by a pre-market trade of 10 million Lion Nathan shares at 494 transacted by ABN Amro. It closed 5c down at $5.

The seller of the big parcel was reported to be a US investment house; locals did the buying.

There was good turnover of $54 million in Fletcher Energy, which closed 5c up at $8.67.

This reflected higher world oil prices and a 5 per cent gain in its US associate, Capstone Turbines.

Carter Holt Harvey, which has languished during the market's run up this year, gained 6c to $1.64 as it played catch-up.

Contact Energy continued its good run, rising 6c to $2.78 after news that its cornerstone shareholder, Edison Mission, does not intend selling its holding despite one of its units filing for bankruptcy protection in California.

Fletcher Building lost 5c to $2.17 and Fletcher Forests was down a cent at 34c.

There were 46 rises and 43 falls among the 147 stocks traded.

- NZPA