NZX CLOSE: NZ shares join global rally; Tower, Pike River gain

Thursday 17th September 2009

New Zealand shares joined a global rally amid optimism the world is climbing out of its economic slump, stoking demand for growth assets including stocks and commodities.

The NZX 50 Index rose 35.21, or 1.1%, to 3152.79, the highest close in 11 months. Within the index, 29 stocks rose, eight fell and 12 were unchanged. Turnover was $110.5 million.

Tower Ltd (NZX: TWR ), the insurer and fund manager, rose 4.4% to $1.67, leading the index higher. Three of six analysts rate the shares a ‘buy’ and the average rating is outperform, according to Reuters.

Pike River Coal (NZX: PRC ) climbed 2.1% to 98 cents. BHP Billiton, the world’s biggest mining company, said it expects the surge in demand for coking coal in China to be sustainable, boding well for global prices including the premium coking coal will produce from its South Island mine. Prices of commodities ranging from copper to oil gained today on speculation demand will pick up as global growth returns.

NZX Ltd (NZX: NZX ), the stock exchange operator, climbed 3.8% to $8.20, the highest since December 2007. Billionaire investor Warren Buffett helped stoke appetite for stocks this week, saying his investment company Berkshire Hathaway is investing in equities.

Fletcher Building (NZX: FBU ), the nation’s biggest construction company, rose 2.3% to $8.37 and Steel & Tube Holdings (NZX: STU ), which sells building materials, rose 3.3% to $3.45.

Telecom Corp (NZX: TEL ) rose 2.2% to $2.74 on expectations the government will deal it into its broadband rollout strategy even after rejecting the phone company’s own proposal.

Separately today, Telecom announced that it will have exclusive rights to sell the TiVo set-top box in New Zealand, which can act as a decoder for FreeviewHD decoder and provide pay-per-view movies and internet services.

Sky Network Television (NZX: SKT ), the nation’s biggest pay-TV company, fell 1.1% to $4.45. Telecom said broadband downloads using the TiVo box won’t count toward its customers’ data limits.

Allied Work Force Group (NZX: AWF ), the worker-for-hire company, fell 5.6% to 85 cents after it said the first six months of its financial year “would be substantially down” on the year-earlier period, reflecting weaker levels of economic activity.

Businesswire.co.nz

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