MARKET CLOSE: Sharemarket rises and world markets rally

Thursday 21st April 2011

The New Zealand sharemarket rose today in the wake of sharp rises by major stock markets after strong corporate earnings in both the United States and Europe.

The benchmark NZX-50 index closed up 19.593 points, or 0.564%, to 3492.396 after rising 16.9 points in early trading. It is at its highest level since June 2008, having yesterday gained 32.8 points.

"Across Asia, regional markets are ending the Easter-shortened week on a positive note, with all indices firmly in the black following the very strong corporate earnings and economic data out of the US overnight," Ben Potter at IG Markets said.

"It's all about risk at the moment. The pickup in corporate earnings and economic data over the last 48 hours has seen money flood back into risk assets," he said.

Fletcher Building (NZX: FBU ) was up 13c to $9.21, Port of Tauranga (NZX: POT ) added 11c to $8.51, Mainfreight (NZX: MFT ) lifted 4c to $9.29, Sky TV (NZX: SKT ) was up 5c to $5.84, Sky City (NZX: SKC ) lifted 4c to $3.46, and Kathmandu (NZX: KMD ) was up 5c to $2.46.

Hallenstein Glasson (NZX: HLG ) rose 4c to $3.98 and Contact Energy (NZX: CEN ) rose 5c to $5.86.

The stocks falling included Telecom (NZX: TEL ), down 2c to $2.13.5. Ebos Group (NZX: EBO ) fell 13c to $7.30. Tower (NZX: TWR ) eased 3c to $1.85 and NZ Refining (NZX: NZR ) eased 5c to $4.50. Sanford (NZX: SAN ) eased 5c to $5.60. Vital Healthcare (NZX: VHP ) eased a cent to $1.09.

World equities, as measured by the MSCI All-Country World Index advanced 2.1%, extending the previous session's 0.5% rise and further recovering from Monday's 1.6% loss.

In the US, earnings surprises gave a positive turn to investor sentiment, propelling US stocks to their best day in a month.

Investors had been set up for a series of disappointments but got an unexpected treat from blue chips Intel Corp and United Technologies Corp, sparking a broad-based rally that puts equities on the path for more gains in coming weeks.

The Dow Jones industrial average gained 1.5% to 12,453.54, the Standard & Poor's 500 rose 1.4% to 1330.36, and the Nasdaq Composite added 2.1% to 2802.51.

The Nasdaq posted its largest daily percentage gain since October while the Dow hit its highest close since early June 2008. The broad S&P 500 had its best performance in a month.

NZPA

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