NZX claws back losses, rises

05:21, Feb 22 2013

The New Zealand sharemarket rose today on the back of a better-than-expected profit from Telecom and a recovery of optimism over the Tasman.

OceanaGold rose, and AMP fell.

The NZX 50 Index rose 44.17 points, or 1.06 per cent to 4,214.60, recovering yesterday's losses and then some.

Within the index 23 stocks rose and 16 fell.

Hamilton Hindin Greene adviser James Smalley said it appeared investors had held "fairly low expectations" for Telecom and Sky Network Television, which both rose on the back of today's results. The New Zealand market also received some flow-on benefit from a recovery in Australian stocks.

The Australian sharemarket surprised investors with a strong rebound this morning, clawing back more than half of yesterday's $35 billion sell-off.

It opened strongly after receiving what were viewed as reassuring comments about global economic conditions from RBA governor Glenn Stevens, although Australian stocks later pared some of the early gains.

New Zealand followed Australia's lead, falling yesterday and recovering today, although Australia experienced deeper losses and a steeper recovery, said Smalley.

Telecom surprised on the upside despite downgrading its full-year earnings forecast, as investors took encouragement from the promise it would move to a lower cost base.

Telecom chief executive Simon Moutter said the company would cut "hundreds" of jobs over the next 10 months as the company reduced its full year Ebitda forecast to $1.04 billion to $1.06b and announced an interim net profit of $163 million on revenues of $2.14b.

Sky Network Television, the pay television operator, rose 3.17 per cent to $5.20 after posting a 9 per cent increase in net profit for the half year to $68.2 million on the back of more subscribers upgrading to MySky and premium channels.

Oceana Gold Corp, the miner which operates that Macraes and Reefton goldfields, lead gainers on the NZX50, rising8.05 per cent to $2.82 and recovering most of yesterdays' losses.

Leading the decliners was AMP after a strong day yesterday.

The Australian wealth manager fell 3.11 per cent to $6.55.

PGG Wrightson fell 2.27 per cent to 43c.

On the currency markets the kiwi dollar regained some lost ground against the greenback.

The kiwi dollar recently traded at US83.75, up from US83.20 this morning.

On the Trade Weighted Index of major trading partners' currencies it was unchanged at 76.20.

On the crosses, the kiwi recently traded at 81.18 Australian cents, down from A81.35c at 8am, 63.14 euro cents, down from 63.40 euro cents, 54.86 pence up from 54.59p, and 78.06 yen up from 77.41 yen.

The 90 day bank bill rate was unchanged at 2.68 per cent.