New Zealand shares bounced back in early trading, with 44 of the top 50 companies in the green.

The S&P/NZX 50 Index was up 247.02 points, or 2.3 per cent, at 11,144.49 at 11am, following a strong lead on Wall Street as the S&P 500 rose 4.9 per cent.

Investors took heart from the global response to the Covid-19 outbreak, including fiscal packages in Australia, Japan, Italy and the US.

The Volatility Index – Wall Street's fear gauge – this week spiked to its highest level since the 2008 global financial crisis because Russia and Saudi Arabia were at odds over cutting oil production.

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That added uncertainty to already-nervous investors worrying about whether the virus outbreak would trigger a global recession.

"What's different for us is that it was the oil sector that took a real beating on that incredibly rough night," said Mark Lister, head of private wealth research at Craigs Investment Partners.

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"Having no banks and having no energy stocks was quite good for the NZX, because it meant our decline was much less severe than we saw across the Tasman and the US."

Air New Zealand led the local market, up 8.4 per cent at $2.065. The national carrier dropped to a four-year low yesterday as it cut capacity in response to dwindling demand.

This week it dropped its forecast for annual earnings because of that uncertainty.

Dual-listed Australia & New Zealand Banking Group rose 5.1 per cent to $22.92 and local lender Heartland Group Holdings advanced 5.5 per cent to $1.53.

Casino and hotel operator SkyCity Entertainment Group was up 5.7 per cent at $3.14, and retailer Kathmandu Holdings jumped 7.2 per cent to $2.68.

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Lister said the current volatility would remain for the next two or three months, and he expected it would ultimately be more negative.

"On a three-month view, the bad news wins. Does lowering interest rates offset the fact that Italy is completely in lockdown? Not really."

Still, he said he was more upbeat about the longer-term once the number of new coronavirus cases passes its peak and the summer months help contain the outbreak.

"On a 12-to-18-month view, I'm not very worried at all about equity markets. I think this will ultimately be a buying opportunity for investors," Lister said.

- BusinessDesk