NZ shares positive after Fed defence

ELOISE GIBSON
Last updated 11:23 27/02/2013

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Finance and business diary Job-match website testing Kiwi waters Markets acting nervous as Fed officials convene Asian shares pinned near 5-month lows Aussie shares stage comeback Overvalued kiwi dollar 'a concern' Wall St closes lower on Fed concerns NZX falls in morning trade Sharp Air NZ share price slump under scrutiny NZX reappointed to world exchange body

New Zealand shares rose strongly at the open, following Wall Street up after US Federal Reserve Chairman Ben Bernanke defended the Fed's bond-buying stimulus.

The NZX 50 Index rose 12.9 points, or 0.3 per cent, to 4251 in the first 30 minutes of trade.

PGG Wrightson, the rural services company, led gainers after announcing an increased interim profit, and Vital Healthcare fell.

Uncertainty generated by Italy's elections continued to unnerve investors in global stocks and European bond markets overnight. However, testimony by Bernanke and strong housing figures lifted stocks in the United States.

Bernanke's testimony to Congress eased worries that monetary policymakers might be getting cold feet about the Federal Reserve's bond-buying programme.

An unclear Italian election outcome has raised fresh concerns about the outlook for the euro zone's debt crisis, with investors fearing anti-austerity parties might take power and weaken efforts to reform public finances.

No single party or coalition appears able to form a majority so far.

US stocks rose overnight after Bernanke's strong defence of the bond-buying stimulus, but optimism was tempered by uncertainty about Europe.

On Wall Street, the Dow Jones industrial average was up 105.39 points, or 0.76 per cent, at 13,889.56. The Standard & Poor's 500 Index was up 6.52 points, or 0.44 per cent, at 1494.37.

On the local bourse, PGG Wrightson rose 2.44 per cent to 42c after announcing an increased profit of $4.8 million for the six months to December 31, up from $3.1m a year ago.

Securities market operator NZX rose 1.6 per cent to $1.27. Pumpkin Patch, the children's clothing chain, rose 1.46 per cent to $1.39. 

On the downwards slide, Vital Healthcare Property Trust, the specialist investors in medical clinic real estate, led decliners, falling 1.5 per cent to $1.31. 

Heartland Bank fell 1.37 per cent to 72c. It posted a half-year net profit after tax of $10.7m earlier this week and declared a debut interim dividend of 2 cents a share.

Goodman Property Trust, the listed real estate investors fell 0.96 per cent to $1.03, while Trade Me pared yesterday's gains, falling 0.64 per cent to $4.67.

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- BusinessDay.co.nz

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