Friday 4th March 2011
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Fletcher Building shares continued to drive the New Zealand sharemarket higher today even though the building firm issued a profit warning.
The benchmark NZX-50 index closed up 20.798 points, or 0.612%, at 3418.106. The index is at its highest level since August 2008.
Fletcher Building (NZX: FBU ) closed up 10c, or 1.15%, at $8.81 and traded as high as $8.94, a level not seen since April 2008.
Fletcher Building today confirmed that it will be included in the S&P/ASX 200 and S&P/ASX 300 indices from March 18, but also said the Christchurch earthquake would knock $14 million to $24 million off its previously forecast full year net earnings.
"Fletcher Building has been the top performing blue chip stock all week. It is getting a lot of investor attention," said Ross Cuthbert, adviser at Craigs Investment Partners.
He said the stock quickly recovered after shedding a 16 cent dividend this week and it was up today even after issuing a profit warning.
"Investors are taking a longer term view. Longer term, they will have a lot more work obviously. I don't think anyone wants to profit from a bad event like an earthquake, but the reality is there is a lot of work to do and Fletcher will do a lot of it because it is the country's main construction company," he said.
Ebos (NZX: EBO ) rose 3c to $7.43, Scott Technology (NZX: SCT ) rose 6c to $1.32 and Mainfreight (NZX: MFT ) rose 7c to $8.12. Hallenstein Glasson (NZX: HLG ) rose 8c to $3.58 and Infratil (NZX: IFT ) rose 2c to $1.98.
In the US, investors were betting upcoming payrolls data would show a big gain in jobs, pushing Wall Street to its best one-day rally in three months, but weak volume lingered.
As oil paused from its recent climb, the market's focus shifted to stronger-than-expected economic data a day before the February US employment report.
The Dow Jones industrial average was up 1.6% at 12,258.20, the Standard & Poor's 500 Index gained 1.7% to 1330.97, and the Nasdaq Composite Index gained 1.8% to 2798.74.
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