NZ stocks: Shares subdued after public holiday, offshore jitters

Investors returned quietly to the New Zealand sharemarket after a public holiday yesterday, and a slide on the Dow Jones added to the subdued tone.

At today's close, the benchmark NZSX-50 had dropped 1 per cent or 38 points to 3600.58, falling more sharply after the Australian market opened.

Australia's ASX was down 1.5 per cent in late afternoon trading, echoing a 1.77 per cent fall on the Dow Jones to 11,048.

Volumes on the New Zealand market were low, and brokers put the wide fluctuations in some share prices down to lack of liquidity.

"It's been very quiet in terms of news flow today and obviously with the holiday yesterday, and so the odd order that is around is pushing stocks either way," Jeremy Coe, of Goldman Sachs JBWere, remarked.

A case in point was the rise of the two Fisher & Paykel companies, Healthcare and Appliances, on "no news at all," although a pullback in the New Zealand currency had helped.

Appliances rose 13c to 454 and Healthcare was up 10c to 457.

Leaders like Contact and Fletcher Building appeared to feeling the offshore jitters about US interest rates and a resulting slowdown in world growth, said Peter Lynds of Direct Broking.

Contact tumbled 15c to 770 and Fletcher Building eased 9c to 891.

But there were some spots of sunshine in mid-cap stocks like Hallenstein Glassons (up 12c to 510) and Tower, which hit a new high of 349 before ending at 345 up 8c.

Brokers said Tower "continued to be re-rated," particularly by Australian investors.

Factors included a recovering New Zealand business and long-term talk of an Australian spin-off, and as a dual-listed stock, its price tended to benefit from a weakening currency.

Sky City eased 7c to 530 on solid trading, as talk continued to swirl around its place on the Australasian gambling scene following Tabcorp's bid for Unitab.

The Auckland-based casino company had "been touted as the last legitimate takeover target in the industry, but then you have other people saying it's just been left out in the cold with no one interested in it," Mr Coe said.

Turnover was also high in top stock Telecom, which lost 15 cents to 445 on volume worth $57 million.

The telco was experiencing a bit of profit-taking after bouncing "a bit too hard" on the back of last month's share price freefall, Mr Coe said.

Brokers also noted the general market tone and Australian press speculation that ceo Theresa Gattung would resign.

Resthome owner Ryman Healthcare jumped 28c to 813 , a move which mystified observers. However, the company had had a recent good result and some valuations put it closer to $10.

Among the falls, Australian-based Lion Nathan tumbled 73c to 922 after rising 22c last Friday. The company was reportedly searching for ways to boost the tax paid returns for New Zealand investors.

Market turnover was moderate at around 37.8 million worth $145.2 million.

Falls outnumbered rises by 70 to 40 on 150 stocks traded.

The former benchmark NZSE all index fell 10.5 points to 1036.01.

- NZPA