NZ stocks: Telecom's result drives market

The sharemarket traded strongly today on the back of a better than expected profit announcement by market leader Telecom, a broker said.

The benchmark NZSX-50 gross index was up 17.47 points, or 0.81 per cent, to 2176.88, while the NZSX-40 capital index was up 15.68 points, or 0.75 per cent, to 2105.48.

At market's close at 5pm, there had been $62.1 million worth of shares traded on volume of 20.3 million. Among the 138 stocks traded were 62 rises and 30 falls.

Telecom shares, which carry a 28 per cent weighting in NZSX-50, finished up 12c at 526 having traded $42.7 million on volume of 8.2 million.

The company today confirmed a $709 million net profit for the June year, $21 million up on an average of analysts' forecasts and a vast improvement on its $188 million loss last year.

Telecom also announced an unchanged fully imputed quarterly dividend of 5c a share.

Forsyth Barr broker David Price said the market had taken its lead from Telecom's result today.

"It was obviously well received. It came out above market expectations," he told NZPA.

"The quality of it (the result) was good on the New Zealand side of things.

"Its growth was the big driver."

Mr Price said Telecom's result marked the start of the "reporting season", which he hoped would rejuvenate a market that has recently seen flat sessions through a lack of corporate news.

Meanwhile, wood processor Carter Holt Harvey was up 2c to 164 after confirming it would spend $58 million to upgrade its Whakatane paperboard mill.

Briscoe Group's shares fell 8c to a three-month low of 179 after it confirmed its profit margin had fallen for a second successive quarter.

The retailer said the profit margin it made from sales in the three months to July was down on the same period last year because of increased competition.

Briscoe directors expected a first half after-tax profit of $9.6 million.

In the United States, the Dow Jones industrial average was up 36.28 points at 9190.25, the broader Standard & Poor's 500 Index was up 3.76 points at 983.91, and the Nasdaq Composite Index gained 4.46 points to 1720.08.

On NZX, shares on the rise included: Contact Energy up 1c to 481, Fisher & Paykel Appliances up 4c to 1350, Guinness Peat Group up 2c to 158, Steel & Tube up 5c to 375, Infratil up 1c to 218, Sky City up 11c to 921, Sky TV up 5c to 470, and Westpac up 5c to 1750.

Shares on the slide included: Auckland International Airport down 3c to 590, AMP down 3c to 540, Lion Nathan down 4c to 596, Promina down 4c to 272, Tower down 3c to 129, The Warehouse down 7c to 465, ANZ Bank down 5c to 2015, F&P Healthcare down 3c to 1157, and Tranz Rail down 3c to 99.

- NZPA