New Zealand shares staged a late rally as the Reserve Bank's cut to the official cash rate boosted the attraction of companies paying reliable dividends such as Contact Energy and Mercury NZ.

The S&P/NZX 50 Index increased 35.66 points, or 0.4 per cent, to 10,063.05. Within the index, 30 stocks rose, 14 fell and six were unchanged. Turnover was $153.2 million.

The benchmark index had been in the red through much of the session, as Asian equity markets followed dour trading in New York amid heightened fears about US-China trade relations.

However, the Reserve Bank's decision to cut the OCR to a record low 1.5 per cent, making dividend yields more attractive than fixed-interest returns and lowering finance costs for corporates, spurred a rally in late trading.

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Companies paying reliable dividends were among those most in vogue. Contact was up 3.8 per cent at $7.14 on a volume of 1.3 million shares, while Mercury NZ rose 2.6 per cent to $3.93 on 712,000 shares.

"The RBNZ cut rates, which was a bit of a surprise in choosing not to follow the lead of the Federal Reserve and RBA," said Greg Smith, head of research at Fat Prophets.

Smith said the impact of the rate cut on the economy will depend on where the central bank settles on imposing tougher capital requirements on banks.

"Even if you ease on rates, if you start tightening up on lending you won't have a meaningful impact on the economy."

Skellerup Holdings led the market higher, up 5.3 per cent at $2.38, on a volume of 158,000 shares. Its 90-day average is 203,000. The rubber goods maker's industrial unit has been expanding its international business and is a beneficiary of a weaker currency. The RBNZ's rate cut immediately knocked the kiwi dollar down more than half a US cent. It was recently at 65.87 US cents.

Among other exporters to gain today, Scales Corp rose 1.8 per cent to $5.07, Vista Group International was up 1.6 per cent at $5.23 on a volume of 1.2 million shares, and Mainfreight rose 0.7 per cent to $35.50.

Spark New Zealand was the most traded stock on a volume of 3.6 million shares, down from its three-month average of 5.7 million. It increased by 0.3 per cent to $3.625. Auckland International Airport was unchanged at $8 on a volume of 3.2 million shares, almost three times its usual volume.

Among other companies trading on volumes of more than a million shares, Kiwi Property Group was unchanged at $1.535, Air New Zealand fell 0.2 per cent to $2.735, and Precinct Properties New Zealand declined 0.3 per cent to $1.595.

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Pushpay Holdings posted the biggest decline on the day, down 2.9 per cent at $3.71 on a volume of 2.9 million shares - about eight times its 90-day average.

The mobile payments system provider today reported an annual profit and was cashflow positive. However, chief executive and founder Chris Heaslip announced he was stepping back from the management team, while retaining his directorship. Chair Bruce Gordon will take over the CEO role.

Smith said Pushpay's result was reasonably good, meeting expectations, but that Heaslip's exit was a surprise.

"Although Gordon has experience and is a safe pair of hands, there's a bit of trepidation when a founder steps away," he said.

Synlait Milk fell 1.5 per cent to $10.50 on a typically small volume of 29,000 shares. The milk processor said the government's new methane targets were in line with the company's own sustainability targets. A2 Milk, which counts Synlait as a supplier, fell 0.7 per cent to $16.32 on a volume of 688,000 shares, below its 819,000 average.

The Carbon Fund, which invests in carbon commodities, last traded at $1.01.

Dairy prices rose for an 11th auction at the Global Dairy Trade event overnight, although whole milk powder prices were down 0.5 per cent. Fonterra Shareholders' Fund units rose 0.5 per cent to $4.27, while Fonterra Cooperative Group's shares, which are restricted to farmer suppliers, fell 0.2 per cent to $4.27.

Outside the benchmark index, Evolve Education shares were halted at 23 cents for a $63.5m capital raising. The company is selling shares at 8 cents apiece in a fully underwritten 4.4-for-1 entitlement offer, largely to repay $30m owed to ASB Bank. The balance will fund a foray into Australia.

The most-traded debt security was Kiwibank's Kiwi Capital Funding capital notes, which pay 6.61 per cent annual interest. Some 1.5 million notes traded at a yield of 3.58 per cent, down 42 basis points.

Some 1.2 million of Chorus's 2023 bonds, paying 4.35 per cent, changed hands today, closing at a yield of 3.55 percent, down 2 basis points. Chorus shares fell 1 per cent to $6.14.