New Zealand shares rallied yesterday with global markets after positive leads from the US, with the local market led by Kathmandu Holdings and Australia & New Zealand Banking Group.

The S&P/NZX50 Index rose 39.88 points, or 0.6 per cent, to 7348.3. Within the index, 32 stocks rose, 11 fell and eight were unchanged. Turnover was $121.7 million.

Kathmandu led the index, up 4.3 per cent to $1.93. Last week, the retailer said its annual profit rose as much as 67 per cent on fatter margins. Net profit was between $33m and $34m in the 12 months ended July 31, up from $20.4m a year earlier and within Kathmandu's upgraded June guidance of between $32m and $35m. The stock has gained 11 per cent since the June announcement.

"They've come closer to the end of the financial year so there's a bit more confidence around what they've seen within their business, and they've changed the way they approach sales programmes, particularly in these key sales periods they have," said Craig Stent, director at Harbour Asset Management. The dual-listed banks advanced as the S&P/ASX 200 outpaced the local index, up 0.8 per cent at 5pm New Zealand time yesterday. ANZ gained 2.6 per cent to $27.49 and Westpac Banking Corp rose 1.8 per cent to $32.60.


"The general market's positive with what happened on Wall Street on Friday their time - job numbers came out and looked pretty strong, probably surprising everyone, the US markets are up about 1 per cent so there's follow on from that in our region," Stent said.

Fletcher Building gained 2.2 per cent to $9.81, Heartland Bank rose 2.2 per cent to $1.40 and NZX advanced 2 per cent to $1.04.

Mercury New Zealand, formerly known as Mighty River Power, was the worst performer, down 2 per cent to $3.02.

Steel & Tube Holdings fell 1.9 per cent to $2.07 and Vector dropped 1.7 per cent to $3.42.

Outside the main index, Augusta Capital rose 1.9 per cent to $1.10. The property investor and funds management firm reaped $2.9m in fees from its biggest property syndication deal on the purchase of the NZME Central complex in downtown Auckland.

Michael Hill International dropped 1.3 per cent to $1.49.

IkeGPS, the laser measurement tool maker that expects to be cash break-even in the fourth quarter of 2017, is in a trading halt pending a placement of shares to institutional investors in Australia and New Zealand.

ASX-listed juice maker Food Revolution Group gained 12.5 per cent to A18 cents.