New Zealand shares dipped, as Mercury New Zealand and Xero fell, while Metro Performance Glass and Air New Zealand gained.

The S&P/NZX 50 Index dropped 18.68 points, or 0.3 per cent, to 7148.78. Within the index, 27 stocks dropped, 19 rose and four were unchanged. Turnover was $123.3 million.

"We saw some very sharp share price movements at the end of the month, as we're wont to do in New Zealand, unbridled flows from ETFs and the like into this market," said Matt Goodson, managing director at Salt Funds Management.

"There appears to be a bit of a continuation of that today as people square up from going on the other side of those flows. They're quite a remarkable factor in this market, it was an extremely strong day yesterday, particularly later in the day."

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Mercury New Zealand was the worst performer on the index, down 2.9 per cent at $3.06. Xero, which, along with other clients of cloud platform Amazon Web Services' S3 hosting service, experienced intermittent disruption today, dropped 2.5 per cent to $18.35.

Metro Performance Glass was the best performer, up 4.9 per cent to $1.50, while Air New Zealand rose 3 per cent to $2.435 and Comvita gained 2.4 per cent to $7.27.

Sky Network Television was unchanged at $3.80.

Sky and Vodafone New Zealand haven't given up hope for a merger despite being rebuffed by the Commerce Commission last week.

Outside the benchmark index, Methven dropped 4.6 per cent to $1.26.

The shower and tapware designer posted a 32 per cent drop in first-half profit after a major supplier in its biggest market, Australia, shut down, but says it's on track for a stronger second half. It has maintained full-year guidance for revenue growth of at least 5 per cent but expects net profit growth to be at the lower end of its 10 per cent to 20 per cent range, with both numbers on a constant currency basis.

New Zealand King Salmon, which listed last October after raising $70m selling shares, rose 0.7 per cent to $1.37. It posted a 52 per cent gain in first-half profit to $8.7m and said it was on track to meet its prospectus target for the full year.

New Zealand Oil & Gas dropped 1.5 per cent to 64c. It narrowed its loss in the final six months of 2016, just before the $168m sale of its stake in the Kupe oil and gas fields, cutting almost a third of its operating costs, and halving exploration expenditure.

TeamTalk gained 2.6 per cent to 78c. The company, which is under a $22.7m hostile takeover offer from Spark NZ, lifted first-half profit 18 per cent to $1.3m, and will consider resuming dividends next year.

SeaDragon was unchanged at 0.6c. The fish oil manufacturer expects to report a wider annual loss of $4.3m to $4.5m, versus a 2016 loss of $400,000, due to the length of time to transition from its Omega-2 business to Omega-3.