RTTNews - New Zealand's stock market opened higher on Friday after receiving a positive lead from Wall Street, where U.S. stocks closed higher as traders there went bargain hunting. The higher close of the U.S. stocks was also prompted by a strong demand for the Treasury Department's latest bond auction.
The benchmark NZX 50 index was up by 16.18 points or 0.58% to 2,786.84 shortly after the market opened for the day, while the broader NZX All Capital index posted a gain of 13.53 points or 0.48% to 2,852.04.
New Zealand's market turned solidly higher on Thursday, following the release of data showing the nation's first quarter trade deficit narrowed. The benchmark NZX-50 index advanced 30.85 points or 1.13 percent at 2,770.66.
Turnover was heavy, led by heavy trading in Australia-NZ dual-listed stocks. The New Zealand Stock Exchange reported trading volume of 36.5 million shares valued at NZ$103.2 million. Advancing stocks outnumbered decliners 47 to 34 with 31 unchanged.
Overseas, U.S. stocks staged a substantial recovery and posted strong gains on Thursday after a disappointing start on the heels of disheartening employment data. The major averages all finished the day firmly in positive territory, with the Dow snapping a four session losing streak.
The rebound came as traders did some bargain hunting in a number of embattled sectors that have trended lower for much of the past month.
Ahead of the opening bell, traders digested a report from the Labor Department showing that initial jobless claims for the week ended June 20th came in at 627,000, up from last week's revised figure of 612,000.
The increase in jobless claims surprised economists, who had expected the number to edge down to 600,000 from the 608,000 originally reported for the previous week. The data prompted a lower open, but selling pressure waned not long after the start of trading.
Separately, the Commerce Department revealed its final revision to the first quarter gross domestic product. The report indicated that first quarter GDP contracted by a revised 5.5 percent compared to the 5.7 percent decrease that had been reported.
Wall Street also watched Federal Reserve Chairman Ben Bernanke as he faced tough questions from lawmakers Thursday regarding his role in Bank of America Corp.'s (BAC) acquisition of Merrill Lynch.
Although Bernanke told members of the House Committee on Oversight and Government Reform that the Fed acted with the highest integrity in working with BofA on the acquisition, some members were less than convinced.
All the major U.S. averages closed higher by comparable margins, each climbing by over 2.1 percent. The Dow finished up by 172.54 points at 8,472.40, the Nasdaq rose 37.20 points to 1,829.54 and the S&P 500 jumped 19.32 points to 920.26.
Crude oil prices rose again on the New York Mercantile Exchange on Thursday amidst more violence in Nigeria. The Movement for the Emancipation of the Niger Delta claimed it attacked a Shell pipeline, according to reports. Violence in the region involving the group has persisted since last month.
Light sweet crude for August delivery climbed to $70.23, up $1.56 on the session. Oil reached as high as $70.93 in mid-day trading.
On the currency front, the New Zealand dollar was buying US64.51c at about 5am on Friday, compared to US64.16c at 5pm on Thursday.
In the early trading on the New Zealand stock market on Friday, market leader Telecom remained unchanged, as second ranked Contact Energy advanced 0.70% and Fletcher Building, the third best stock, added 1.72%.
In the retail sector, Hallenstein Glasson, jewelry retailer Michael Hill International and Pumpkin Patch remained unchanged, as Warehouse posted a gain of 0.54%.
In the energy sector, Vector collected 0.99%, as TrustPower remained unchanged in the early trading on Friday.
Among the dual listed issues, AMP, Australia and NZ Banking Corp, APN News & Media, Lion Nathan, Telstra and Westpac Bank remained unchanged in the day's early trading.
Among other notable stocks, Infratil gained 0.57%, Mainfreight collected 1.18%, Nuplex advanced 0.67%, Sky City added 0.36%, Sky Network Television inched up by 0.24% and Steel & Tube Holdings dropped 1.70%, as Methven remained unchanged. Fisher & Paykel Appliances fell 1.47%, as Fisher & Paykel Healthcare climbed 1.02%.
The other gainers in the day's early trading included-- Auckland International Airport by 0.62%, Air New Zealand by 2.20%, Freightways by 0.71%, ING Property Trust by 3.33%, New Zealand Oil & Gas by 1.29%, New Zealand Refining Company by 1.02%, NZ Farming Systems by 2.04%, NZX Limited by 1.20%, PGG Wrightson by 0.88%, Pike River Coal by 2.63% and Rakon by 2.10%.
Apart from Fisher & Paykel Appliances and Steel & Tube Holdings, there were only two other losers among the stocks listed under the NZX 50 index on Friday morning. While Guinness Peat Group fell 1.75%, Ryman Healthcare Limited posted a loss of 0.62% in the day's early trading.
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