Utilities buoy sharemarket
The S&P/NZX 50 Index gained 71.47 points, or 0.6 percent, to 11,417.78. Within the index, 18 stocks rose, 28 fell, and four were unchanged. Turnover was $242.8 million.
David Price, a broker at Forysth Barr, said low long-term interest rates supported demand for equities offering reliable returns. He was less upbeat about how much support another rate cut by the Reserve Bank would provide to the economy, and, in turn, corporate earnings.
“The Reserve Bank decision is irrelevant. We are already at 1 percent; there are no bullets left,” he said. “There is a dark cloud coming and there is no sense in firing a pop gun at it.”
US share markets fell overnight after the Federal Reserve announced an emergency rate cut of 50 basis points. While the S&P 500 was up 0.5 percent before the announcement, it closed 2.8 percent lower. The other indices also fell, with the Dow Jones Industrial Average falling 2.9 percent and the Nasdaq down 3 percent.
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