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NZ Shares Surge Nearly 2 Percent, Telecom Hits Seven-Mth High

Contributor:
Fuseworks Media
Fuseworks Media

Wellington, May 5 NZPA - The sharemarket's benchmark top-50 index closed above the 2800-point level for the first time since November 2008, pulling away from recent five-year lows.

The NZSX-50 closed up 52.78 points, or 1.9 percent, at 2819.05, following a 46-point rise yesterday. Turnover was valued at $118.6 million.

"Just follow-on from overseas markets -- the overnight markets were strong and of course Asian and Australian markets have been reasonable," said Stephen Wright of ASB Securities.

The index had hit a high during the day of 2837.7.

Australia's S&P/ASX 200 Index gave up almost all of the day's gains to be up 0.3 percent at 3892 following a no-change, as expected, to interest rates from the Reserve Bank of Australia.

Just five of the top-50 stocks were negative. The Warehouse lost 3c to 375, Steel & Tube fell 2c to 294, Sanford was down 5c at 555, Lion Nathan fell 5c to 1498, and Telstra was down 5c at 428.

Top stock Telecom gained 4c to a seven-month high of 278, Contact Energy jumped 26c to 610, its highest since late March, and Fletcher Building was up 3c at 693.

Fisher & Paykel Healthcare rose 6c to 311, F&P Appliances was up 5c at 56, Auckland Airport was up 2c at 171, and Sky City gained 7c to 277.

NZX jumped 33c to 751 after some signs of improved performance despite sluggish turnover in April.

The $3.2 billion in capital raised by companies in the first four months of 2009 was already higher than the $3.1 billion raised for all of 2008, the market operator said.

Mainfreight gained 15c to 470, carpetmaker Cavalier rose 10c to 175, Trustpower rose 15c to 730, Rakon was up 18c at 150, Vector was up 5c at 218 and Port of Tauranga gained 10c to 560.

Asian markets were mixed after the previous day's big rally as investors became cautious ahead of the United States government's "stress tests" for the 19 largest American financial companies later this week.

Global markets had surged on Monday amid signs of recovery in China, India and the US, with several Asian markets rising more than 5 percent.

In the US, the S&P 500 hit positive territory for the year as investors bet banks' capital shortfalls may be manageable and housing data fuelled hopes the recession was easing.

NZPA WGT AP Reuters mfc gt

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