NZ stocks close 20 points down

The New Zealand sharemarket followed weak leads from offshore markets to trade lower today and heavyweight shares like Fletcher Building reflected the trend.

However, Telecom rose 2c to 218 as the market reacted favourably to news that it was working with rival Vodafone to win a tender for the Government's rural broadband initiative.

"I don't know if the numerical side will be huge but they seem to be doing the right thing. It is a good thing," said David Price at Forsyth Barr.

The benchmark NZX-50 index closed down 20.917 points, or 0.628 per cent, at 3310.584.

Fletcher Building fell 13c to 790 and Mr Price said the stock has drifted back on not too bad a volume. "The residential housing market has just not improved," he said.

IG Markets said markets across the region were selling off this afternoon for no apparent reason. The re-emergence of European debt concerns has reversed the US dollar decline, in turn crimping the recent equities rally.

In New Zealand, companies have been reporting flat operating environments in trading updates this week, which is seen as indicative of the patchy economic recovery.

The Warehouse closed unchanged at 388 but traded as low as 380 today after reporting sales slipping 0.2 per cent in the latest quarter from a year earlier. The group said it was not yet seeing signs of any real or sustainable recovery in consumer spending.

Infrastructure investor Infratil also added 2c, on low volume, to 188 after saying it was considering making a public bond offer. APN News & Media did not trade in this market but said today it had accepted firm commitments to sell $100 million of five-year bonds after a bookbuild.

Kiwi Income Property Trust was unchanged at 104 after reporting a 10 per cent rise in first half distributable profit to $33 million, largely as a result of a fall in tax expenses.

Xero shares closed up 3c at 195, and traded to a record 196, after yesterday reporting half year revenue of $3.7m, up from $1.3m a year earlier.

Cavalier Carpets rose 5c to 320, Restaurant Brands rose 1c to 274, Sanford rose 7c to 470 and Mainfreight rose 3c to 739. Ebos rose 5c to 730.

Contact Energy eased 2c to 597, Nuplex eased 5c to 335 and SkyCity eased 2c to 319.

In the US, stocks fell after a disappointing outlook from Cisco rattled the market.

Traders were also on edge as world leaders meet in South Korea in hopes of heading off another bad turn in global trade relations.

According to preliminary calculations, the Dow Jones industrial average fell 0.7 per cent to close at 11,283, the S&P 500 index fell 0.4 per cent, to 1213, and the Nasdaq lost 0.9 per cent, to 2555.

- NZPA