NZ stocks: Australian holiday dampens sharemarket trade

12.15 pm

The New Zealand sharemarket had a soft start to the week, with a holiday in some Australian states exacerbating the usual quiet Monday trading.

By mid-morning the NZSE-40 capital index was down 12.84 points, or 0.63 per cent, at 2039.59.

Turnover of 7.55 million stocks valued at $18.00 million was topped by Telecom's $3.44 million worth of trade.

Wayne Schuler of Forsyth Barr Frater Williams said the market was unlikely to pick up its feet during the day.

"It's pretty lacklustre. We've seen Contact Energy pull back on the warmer weather down south (where the hydro lakes are), and wholesale electricity prices off towards the end of last week," Mr Schuler said.

Contact, a generating company, was down 5c at 312 as New Zealand's electricity consumers continue to cut back on power use to stave off a full blown electricity crisis.

Low lake levels and little prospect of rain have helped spark a huge rise in wholesale electricity prices.

Electricity generator and retailer TrustPower lost 6c to 330.

Montana and brewer Lion Nathan were unchanged this morning, at 455 and 530 respectively. After the market closed on Friday Montana announced that it would delay the release of an independent report in a takeover bid by British drinks company Allied Domecq until Wednesday.

Montana said it postponed the release despite a ruling from the Stock Exchange, because another ruling on rival bidder Lion Nathan had changed the nature of the report. To release it would have misled shareholders, it said.

Casino operator Sky City shed 41c to 1085 after a report on Sunday that its investment in cinema company Force Corp was in doubt as Sky directors were unhappy at the prospect of paying more money to service debts in an Argentinian cinema chain.

The Sunday Star Times newspaper quoted unidentified sources as saying that walking away from 50.2 per cent owned Force would do less damage to Sky City's balance sheet than continuing to bail it out.

Force shares were down 3.6c at 14.9.

Baycorp shares shed 10c to 1240, despite expectations of a positive announcement mid-week on the long-time merger talks between Baycorp and Australian counterpart Data Advantage.

Telecom shares lost 6c to 522 after US tech stocks finished on a weak note on Friday.

Elsewhere on the market, Waste Management shares lost 8c to 352 after posting a little improved interim net profit of $6.72 million today.

Air New Zealand A and B shares both fell 1c, to 111 and 133 respectively.

Discount retailer The Warehouse rose 2c to 558, and Utilico rose 5c to 48 while Fletcher Building lost 5c to 258, Carter Holt Harvey fell 2c to 176, Fisher & Paykel lost 6c to 1260 and biotech company Blis shed 3c to 105 - all on light volume.

There were 32 falls and 32 rises on 126 stocks traded.

On Wall Street on Friday, the Nasdaq Composite Index fell 21.05 points, or 1.01 per cent, to 2066.33.

The Dow Jones industrial average lost 38.4 points, or 0.36 per cent, to 10,512.78, and the broader Standard & Poor's 500 Index was down 6.40 points, or 0.52 per cent, at 1214.35.

- NZPA