MARKET CLOSE: Modest early gain for sharemarket

Thursday 3rd March 2011

A near 2% rise in the price of Fletcher Building's shares helped propel the New Zealand sharemarket higher today.

In the wake of the local reporting season investors are focused on oil price rises on news of an airstrike in Libya near an oil terminal, a rise in the price of gold to a record high, and the implications of the Christchurch earthquakes.

The benchmark NZX-50 index closed up 15.315 points, or 0.453%, at 3397.308. Turnover was worth $123.8 million. There were 45 rises and 34 falls among the 115 stocks traded.

Fletcher Building (NZX: FBU ), the nation's largest building company, rose 17c, or 1.99%, to $8.71.

The company said in a presentation this week that the outlook for its 2011 financial year is mixed due to the impacts of Queensland floods and the Canterbury earthquake. Canterbury earthquake repair work will be significant, it said.

NZ Refining (NZX: NZR ), operator of the country's only oil refinery, rose 18c to $5.00.

"The market can probably handle the current oil price as long as it's temporary and returns to more fundamentally-driven levels," Ben Potter at IG Markets said. "The longer prices remain elevated, the more markets will worry about prices derailing the global economic recovery," he said.

Steel & Tube (NZX: STU ) rose 1c to $2.64, NZX (NZX: NZX ) rose 2c to $1.85 and SkyCity (NZX: SKC ) rose 2c to $3.36. Nuplex (NZX: NPX ) rose 5c to $3.39 and Infratil (NZX: IFT ) rose 3c to $1.96.

Rakon (NZX: RAK ) rose 4c to $1.10, while Scott Technology (NZX: SCT ) eased 6c to $1.26 even though it said its Christchurch facility has managed to return to near full operating capacity.

PGG Wrightson (NZX: PGW ) was unchanged at 51 on a day the target of a bid for control from China's Agria said it did not know what the intentions of investment company Zuellig were.

Contact Energy (NZX: CEN ) fell 7c to $6.08, Air NZ (NZX: AIR ) fell 2c to $1.28 and Sanford (NZX: SAN ) fell 5c to $5.05. The Warehouse (NZX: WHS ) fell 5c to $3.38 and Pumpkin Patch (NZX: PPL ) fell 2c to $1.26.

In the US, stocks eked out gains despite rising oil prices, as investors bet the latest signs of economic strength may be able to absorb expected higher energy costs.

Wall Street seesawed against the changes in oil throughout the day. Brent crude rose to a two-1/2-year high above US$117 a barrel in the late morning after the bombing raids near Libya's oil terminals, but later slipped.

The Dow Jones industrial average gained 0.1% to 12,066.80, the Standard & Poor's 500 Index gained 0.2% to 1308.45, and the Nasdaq Composite Index gained 0.4% to 2748.07.

Gold climbed to an all-time record at $US1440.10 an ounce. The metal has rallied 10% since late January when tensions first began to flare in the Middle East and Africa.

NZPA

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