Fletcher Building, Steel & Tube lead NZ sharemarket higher

Fletcher Building, Steel & Tube and Cavalier Carpets shares soared and Tower shares plunged as investors assessed the implications of Saturday's destructive earthquake in Canterbury on the corporate sector.

Brokers said at times the reaction was knee-jerk as Tower's losses will be limited to $3.5 million after-tax because of re-insurance, and the flow of work for builders will be over a period of time.

Many companies issued statements detailing the impact on their assets in the quake zone and banks moved to offer support packages to customers.

The benchmark NZX-50 index closed up 35.713 points, or 1.149 percent, at 3143.142 as global equity markets rallied on the back of a better-than-anticipated US payrolls report on Friday.

Fletcher Building, the country's biggest building firm, rose 39c to $8.14 and Steel & Tube rose 17c to $2.37.

"The market has chosen to anoint Fletcher Building and Steel & Tube and Tower was beaten down," said James Lee, head of institutional equities at First NZ Capital

Tower closed down 6c at $1.85 and traded as low as $1.75.

Telecom continued a strong run after dropping a dividend last week, closing up 4c to $2.09.

Mr Lee said reconstruction will mean more concrete and steel is needed.

"There is a huge amount of work to be done but the timing of it is far from certain," he said.

He said Fletcher Building has rallied from $7.17 in mid-July.

"At these sorts of levels it is implying the economy is going to get better," he said.

There was good volume in Fletcher Building and Goodman Property. Goodman Property rose 1c to 95c after reporting its portfolio was largely unaffected by the earthquake.

Cavalier Carpets rose 8c to $2.64. Property for Industry, which has two properties in Christchurch, fell 1c to $1.14.

The Warehouse was unchanged at $3.65, and Mainfreight was unchanged at $6.80. NZOG rose 4c to $1.24 and Nuplex rose 8c to $3.30. Methven rose 2c to $1.58. Goodman Fielder rose 2c to $1.75.

Hellaby fell 22c to $1.83 and Ebos fell 6c to $6.80.

Allied Farmers rose to 2.8c after saying it had been awarded $3.5 million from a receivership of a development in Beverley Hills, California.

In the US, The Dow Jones industrial average shot up 127.83 points, or 1.24 percent, to 10,447.93, marking a move back into the black for the year. The Standard & Poor's 500 Index gained 14.41 points, or 1.32 percent, to 1104.51. The Nasdaq Composite Index rose 33.74 points, or 1.53 percent, to 2233.75.