Market fails to rally after bank injections

By NZPA

Monday 13th August 2007

The sharemarket was still stinging from a brutal day on world equity markets on Friday, falling nearly 1%.

Ignoring a 1% rise on the Australian market and signs of recovery in Asia, the NZSX-50 index today closed down 0.9% or 39.6 points to 4070.16 on a low total turnover of $97 million.

International markets have tentatively rebounded after major central banks injected $US400 billion in funds to ensure the US credit crisis did not crimp liquidity.

Forsyth Barr broker David Price said it was a little surprising how weak the local bourse was today.

"I think people today have been a bit more cautious. Last week we saw some opportune buying ...People are just biding their time and seeing what plays out offshore."

The market shed 1.2% on Friday, and was prevented from plunging further by strong interest in Telecom.

But today the telco was down 7c to $4.28.

Brokers did not think it was related to today's news that Telecom would allow its biggest mobile rival, Vodaphone, to use its network, as rules tighten to create more competition in the mobile area.

Other blue-chips were also singing the blues, with Fletcher Building down 16c to $12.08, Contact down 16c to $9.05, Sky City down 7c to $4.55 and Auckland Airport down 4c to $3.11.

Some currency-sensitive stocks appeared to react to the softening dollar with Pumpkin Patch up 3c to $3.35, Michael Hill up 5c to $9.20, F&P Appliances up 3c to $3.46, and Sky TV -- which buys in US dollars -- down 12c to $5.48.

Others were down including Hallenstein Glasson down 10c to $4.60, and F&P Healthcare down 2c to $3.48.

Infratil fell 7c to $2.92, Mainfreight dropped 10c to $7.40, and Air NZ slid 4c to $2.40.

Bucking the trend was the Warehouse, up 4c to $6.11, Rakon up 7c to $4.75, Port of Tauranga up 10c to $6.90, and Australian banks Westpac up 39c to $29.84c and ANZ up 37c to $32.50.

Apple computer distributor Renaissance Corp rose 3c to 96 after the company said it was buying Natcoll, a private college of creative design.

AMP NZ Office Trust (ANZO) eased a cent to $1.25 after reporting a 14% increase in full-year operating profit before tax to $41 million.

Falls outnumbered rises 68 to 35 on 146 stocks traded.

On Wall Street, the Dow Jones industrials closed out a tough week Friday, ending with just a 31-point, or 0.23% loss for the day and managing to post a gain for the week.

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