NZ stocks: Tepid response to Wall St surge

12.15 pm

Local shares were generally slightly stronger today in a tepid response to a strong surge on Wall Street on Friday.

Brokers said the local market had anticipated Wall Street's rise when it gained 1.7 per cent on Friday.

Salomon Smith Barney broker Craig Robins said he expected a measured response to the big gains in the US.

"I suspect there might be some residual buying out there so things won't come back too much," he said.

There was still good demand for The Warehouse, up 12c to 590, Baycorp, steady on 1360, Auckland Airport, up 1c at 384. The NZSE-40 Capital Index was up just 2.26 points at 2074.65 just after 11am. Turnover by value was $20 million.

The big rally in the US came after technology bellwether Cisco Systems said business was stabilising, and strong new home sales boosted optimism consumers are propping up a key sector of the US economy.

The technology-laced Nasdaq index gained 73.83 points, or 4.01 per cent, to 1916.80 its biggest one-day gain since July 12, when it surged 5.26 per cent.

The Dow Jones industrial average jumped 194.02 points, or 1.9 per cent, to 10,423.17 - also its biggest rally since July 12.

Here, Air New Zealand A shares fell 1c to 99c and the Bs were steady on 123 as investors nervously await a decision expected today on the company's share structure.

Three scenarios have been speculated on by the media including allowing Singapore Airlines to increase its holding, alternatively Qantas getting the green light to own 25 per cent and a government loan. The latter is considered the least favoured option by investors.

Montana was unchanged on 473 in the wake of Allied Domecq's victory over Lion Nathan on Friday. The latter was also unchanged on 565.

Carpet maker Cavalier fell 10c to 555 after posting a 22 per cent fall in net profit to $10.3 million.

Cavalier declared a fully imputed final dividend of 16c, up from 14c, making a total dividend payout for the year of $10.8 million -- 105 per cent of net profit and 83 per cent of profit from ongoing businesses.

Fletcher Building fell 2c to 265, Carter Holt fell 2c to 172, Independent Newspapers was steady at 370 and Wrightson gained 3c to 115. Fisher and Paykel fell back 20c to 1400.

There were 36 rises and 18 falls among the 98 stocks traded.

- NZPA