MARKET CLOSE: NZ shares rise, led by Telstra, Telecom

Monday 21st June 2010

New Zealand shares rose, with the benchmark NZX 50 Index breaking the 3,060 point mark for only the second time since May 31, as Telstra advanced on news it has signed a non-binding agreement to participate in the rollout of Australian’s National Broadband network.

The NZX 50 rose 20.74 or 0.6 percent to 3068.24. Within the index 22 stocks rose, 13 fell, and 15 were unchanged. Turnover was $68.7 million.

Telstra (NZX: TLS ) rose 9.5% to $4.16 on the NZX. The shares also gained 4.3% to A$3.70 on the ASX after the weekend announcement that the company signed an accord with the Rudd administration that would see the company migrate its voice and data traffic onto the new government-backed network.

The news also had a positive spin for Telecom (NZX: TEL ) rose 2.7% to $1.94.

“You have to wonder whether the market is trying to draw parallels to Telecom to see if it is able to negotiate a similar deal to Telstra, which would have the potential for some upside,” said Craig Brown, senior investment analyst for ING New Zealand. “But you have to remember that Telstra have been working with government on their fibre business for a long time, and they have probably progressed a lot farther down that line than Telecom has here. That’s not to say that can’t do it, but there are a lot of variables.”

Westpac (NZX: WBC ) rose 1.7% up $29.38 and ANZ (NZX: ANZ ) rose 1.7% to $29.38.

PGG Wrightson (NZX: PGW ) was 1.9% up at 54 cents. Fisher and Paykel Apppliances (NZX: FPA ) rose 1.7% to 59 cents.

Guinness Peat Group (NZX: GPG ) fell 0.8% to $3.60, while Tower (NZX: TWR ) fell 2.6% to $1.89.

AMP (NZX: AMP ) rose 0.3% to $6.98 after gaining Commerce Commission approval to acquire the Australasian assets of Axa Asia Pacific Holdings Ltd. AMP is in pole position to bid for Axa after rival suitor National Australia Bank was knocked back in its superior A$13.29 billion proposal by Australia’s regulator.

OceanaGold (NZX: OGC ), the operator of the Macraes gold field, rose 1.5% to a new record high close of $4.76 after the price of gold pushed up to a new record. The shares have soared 244% in the past 12 months.

Businesswire.co.nz

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