NZ market out performs others

The New Zealand sharemarket outperformed markets in Asia for a second day, mostly due to strength in leading stocks.

The benchmark NZSX-50 index closed down 7.16 points, or 0.224 per cent, at 3195.60, having recovered from a drop of as much as 30 points earlier.

ASB Securities adviser Stephen Wright said it was a credible performance given Asian markets have fallen an average of 2 per cent.

Telecom was one of the saviours yesterday, he said, and the slight fall of the index today was mostly due to the number of stocks declining compared to those that had gone up.

Among leading stocks, Fletcher Building fell 6c to 822, Contact Energy was down 1c to 622, while Telecom went up 4c to 259.

From the stocks that rose today, ANZ went up 25c to 2875, Nuplex went up 4c to 245, Goodman went up 5c to 205 and Fisher & Paykel Healthcare went up 10c to 310.

"Fisher & Paykel benefits from the lower New Zealand dollar, after Alan Bollard said that he was still going to maintain low interest rates until late next year," said Mr Wright.

"I think the market probably also benefited from that because the market has been picking that interest rates were going to rise sooner rather than later."

Dr Bollard indicated the first hike will not be until the second half of 2010, whereas the market was projecting the hike as early as January.

His statement had a projected effect on the New Zealand dollar, which fell from around US74.40c midday yesterday, to US72c around 10 am, and US71.75 at 5pm.

Trustpower fell 5c to 755, Mainfreight lost 11c to 532, Pike River Coal dropped 3c to 109, NZ Oil & Gas dropped 4c to 169, Air NZ 4c to 130, New Zealand Refining was down 25c to 512, and The Warehouse fell 11c to 444.

Freightways was down 15c to 300 after reporting a decline in revenue of 5 per cent for the September quarter today, and dual-listed bank Westpac fell 85c to 3235.

In the US, financials, technology, materials and industrial sectors, which underpinned the market's advance from March, bore the brunt of the slide as investors reassessed their bets.

"The housing data definitely created an additional leg down in the market," said Mike O'Rourke, chief market strategist at institutional brokerage firm BTIG in New York.

"A lot of people realise that we're correcting right now and are being cautious."

The Dow Jones industrial average dropped 1.2 per cent to 9762.69, the Standard & Poor's 500 Index fell 2 per cent to 1042.63, and the Nasdaq Composite Index slid 2.7 per cent to 2059.61.

- NZPA