THE NZSE-40 Capital Index closed up 29.7 points or 1.48 per cent yesterday at 2,039.78, its highest close since December 1989. ''The market built on a very strong performance from Telecom in New York and that gave the market very solid underpinning,'' said Don Turkington at Cavill White. Telecom, the largest stock, was propelled 17 cents higher to a record close of $4.40. Turnover was a hefty 4.2 million shares. Overall turnover for the market was worth $59.4 million. Brokers said the November 6 election was doing nothing to inhibit investors and even a weak Australian market failed to dampen the mood. ''Most of the companies look attractive whoever wins the election,'' Mr Turkington said. KUALA LUMPUR A SURGE in shares of giants Telekom Malaysia and Tenaga Nasional drove the benchmark Kuala Lumpur Stock Exchange Composite Index past the 900-point barrier, but late profit-taking dragged the index from its high at the close. The index closed up 10.56 points at 905.71, after earlier setting a record high of 912.74. ''I don't know when it will stop,'' said Kanajan Samypullay, an institutional dealer at CIMB Securities. ''It's like it will go on forever.'' Brokers said excess liquidity in the market would continue to drive shares higher in the near term although intermittent profit-taking might set in. Dunlop Estate surged $1.30 to $9.30 on its offer to sell shares in its gaming subsidiary, Magnum Corp, to shareholders. MANILA MARKET leader Philippine Long Distance Telephone Co (PLDT), buoyed by a strong finish on Wall Street, drove the market to anall-time high and sent investors jumping into other blue chips. The Manila index hit a new high at 2,093.83, up 67.3 points from Monday's level. Makati also set a new record at 2,162.65. ''The impressive performance of PLDT reflects the confidence of foreign investors in our country,'' said Robinson Siao, sales manager at Abacus Securities. Foreign investors see PLDT as an undervalued telecommunications stock, he said. ''The whole market is foreign driven. Foreign funds are trying to re-adjust their portfolios to reflect a much heavier weighting on the Philippine market,'' Mr Siao said. TOKYO STOCKS ended lower in quiet trade, with the Nikkei 225 Average off sharply after a new stock index was launched. Selling of the shares excluded from the new, weighted Nikkei 300 is expected to continue and lead the old Nikkei 225 to fall below 20,000. ''Selling pressure will continue, but buying on dips is expected to emerge when the Nikkei nears support at 20,000,'' said Masayoshi Yano at Nikko Securities. ''Investors will pay less attention to the index and more to select individual shares,'' he said. The Nikkei ended down 241.33 points or 1.18 per cent at 20,137.31, with about 220 million shares traded. The broader first section Topix index closed down 4.14 points or 0.25 per cent at 1,652.26. On the first trading day after Nihon Keizai Shimbun started the new stock index, the market opened mixed with the Nikkei weaker and Topix firmer. Activity was dominated by selling of shares dropped from the new Nikkei 300, and buying of those that were included, brokers said. The new index will continue to trade alongside the 225-share average. But the market was reluctant to move in the afternoon after the Nikkei Average slipped to the day's low of 20,116.71 shortly before the mid-day close. ''I don't think the Nikkei's 240-point drop is significant at all,'' said Mr Yano. ''Selling of those 70 issues [excluded from the new index] accounted for 170 points of the fall. In that sense, the Nikkei actually only lost 70 points.'' TAIPEI STOCKS closed higher across the board in active trade on buying by institutions and major players after Monday's holiday. The index opened firm and ended 56.59 points or 1.5 per cent up at its intra-day high of 3,942.25. Turnover was NT$20.47 billion against $10.57 billion in the short Saturday session. Buying was particularly strong in selected electronics showing rapid profit growth. ASE, which said its profits of $300 million in the first three quarters of this year exceeded its original forecast of $250 million for the whole of 1993, surged $2.30 to $49.20. Acer climbed 40 cents to $25.50. SYDNEY THE market ended a nine-day rally to close lower. Brokers said profit-taking, particularly in News Corp, was behind an 11.8-point fall in the All Ordinaries Index to 2,028. ''You can't have nine days of a vertical run without having some sort of correction,'' said Austock broker Peter Stock. Short-covering in December index futures also created uncertainty in the physical market, brokers said. The All Industrials ended 18.4 points down at 3,157.3 and the All Resources fell 6.6 points to 1,164.5. ''The selling books had control of the morning and it held that course all day,'' one broker said. ''It wasn't a bad effort overall.'' National turnover reached 167.62 million shares worth A$363.58 million, with falls slightly ahead of rises. SEOUL STOCKS closed a fraction higher in moderate trading although profit-taking emerged in the afternoon to erode the morning's gains led by export-orientated electronics and vehicle counters. ''Institutional investors cashed in in late trading,'' said a Daishin broker. Brokers said the market remained unaffected by yesterday's deadline for identifying false-name financial accounts. They forecast stocks would continue to face a downward correction today with institutions preferring the sidelines. The Composite Index ended 1.48 points up at 723.57. A total of 32.47 million shares worth 553.86 billion won changed hands compared with 23.4 million shares valued at 396.68 billion won on Monday. Gainers outpaced losers by 408 to 342 with 62 unchanged. Brokers said low price-to-book-value counters continued to gain momentum. BANGKOK THE Stock Exchange of Thailand (SET) Index dropped 21.78 points amid heavy selling in an over-heating market to close at 1,101.96 points. A total of 253.8 million shares worth 16.1 billion baht changed hands. The fall was the first since the market began a dramatic 152.3-point surge on October 1. Both foreign and domestic investors sold on the general perception that the market was over-heating, a broker said. Reports of foreign selling further unsettled domestic investors compounding the drop, he said. Falls outnumbered rises by 233 to 64, with 57 issues unchanged. JAKARTA TRADING was active and most prices closed higher. ''Besides Barito Pacific, several other counters were active, partly caused by an anticipation of a rise in the level of foreign ownership in the near future,'' a broker said. Barito rebounded again to close at 11,000 rupiah, 250 higher. Semen Gresik rose 300 to 7,600 and Ganda Wangsa 150 to 2,900. Smart Co also gained 100 to close at 5,600. The official index ended 3.47 points higher at 443.87. The Chinese share prices are provided by Telerate. All other prices are provided by Reuter.