New Zealand\'s openers reached 131 for 0 at stumps after Bruce Martin and Neil Wagner helped the hosts bowl out England cheaply.
Dunedin: Openers Hamish Rutherford and Peter Fulton capitalised on the cheap dismissal of England by guiding New Zealand to 131 without loss at close of play on the second day of the first test on Thursday.
Bowlers Neil Wagner and Bruce Martin had earlier taken four wickets apiece to shock England by dismissing the misfiring tourists for 167 in less than two sessions at University Oval.
Rutherford finished the day 77 not out in his first test innings, while the Fulton had made 46 in his first test since 2009 and New Zealand will resume on Friday needing just another 37 runs to take a first innings lead.
The opening batsmen made a nervous start against a fired up James Anderson and Steve Finn with Fulton looking particularly tentative, pushing at the ball away from his body rather than getting behind the line.
He settled, though, and when he hit successive boundaries off Anderson in the seventh over, England's Barmy Army of supporters sparked into life in an attempt to inspire their team on the field.
The first "Barmy Army" chants of the match only resulted in Rutherford twice slapping Finn through the covers to the boundary, however.
The pair went on to post New Zealand's first opening stand of more than 100 in 11 tests and ensured the home side took the honours on the first day of action after all play on Wednesday was washed out by rain.
Wagner had set the tone for a good day for the hosts by blasting the top off England's vaunted batting order with three wickets - including captain Alastair Cook (10) and Kevin Pietersen in successive deliveries.
England went into lunch at 81 for five and Martin, making his debut at the age of 32, drove home the advantage in the first hour after the break by claiming a trio of wickets for himself.
Anderson and Finn provided some late order resistance with a 47-run partnership but Wagner ended the stand when the latter was caught in the deep by Rutherford for 20.
Martin wrapped up the innings when Wagner caught Anderson for 23 and tea was taken early. Wagner finished with four for 42 from 11 overs, while Martin had four for 43 from 14.
New Zealand's attack was tidy without being overly penetrating and England's batsmen were largely the architects of their own downfall.
Jonathan Trott top-scored with 45 but, like Cook, Ian Bell (24), Joe Root (four) and Matt Prior (23), he fell to a false shot.