NZ stocks: Telecom eases on bearish market

Telecom had another rough day on a bearish sharemarket today, but retail stocks enjoyed a strong Christmas run-up.

The benchmark NZSE-40 capital index settled down 11.56 points or 0.6 per cent to 1910.95, after dipping to a year-low of 1903 on Friday. Turnover was a moderate $45 million.

Telecom touched a fresh 14-month low at 435 on concern that a recovery in earnings may be delayed until the second half of next year. It ended down 6c at 438 on $7 million turnover.

"Telecom continues to disappoint," said ABN Amro Craigs Equities advisor Nigel Scott.

Telecom's shares have dropped 8 per cent in the past month after it forecast little growth in Australian sales and began running into regulatory constraints at home.

Australian telco Telstra also slumped 10c to 482.

But the day appeared to belong to retailers, particularly the Warehouse - up 14c to 720 - and Briscoe Group - up 8c to 274 - as investors priced in expectations of a good Christmas and likely import benefits from the stronger dollar.

Today's currency strength, which saw the New Zealand dollar keep above the US51c mark and peek above the A91c level, was also expected to have ramifications for other stocks.

"The market's going to start looking out six months to see how well managed people's currencies are and I think most people give a pretty clear indication now as to their outlook on currency cover," said Mr Scott.

Contact Energy slumped 22c to 377, although 15c was due to a dividend payout.

Fisher & Paykel Healthcare was steady at 990, although turnover was relatively high at $2.07 million.

Auckland Airport continued to be in demand, up 2c to 549, which Mr Scott said put paid to the general impression of a share overhang.

Tower rose 8c to 177 following a weekend media report on the company's future.

A large line crossed in fishing company Sanford pushed the stock up 5c before it settled flat at 505.

Healthy Sky City closed up 10c to 782 on strong turnover , and gas company NGC Holdings rose 2c to crack the $1.40 barrier it has been trapped under for some time.

Restaurant Brands, owner of the KFC franchise in New Zealand, was up 10c to 155 as the company announced it was switching to a cheaper chicken supplier.

It was a bad day for Australian-based banks, which slumped as earnings forecasts began looking shaky. ANZ lost 60c to 1895, AMP crashed 50c to 1250 and Westpac tumbled 40c to 1420.

Other moves included Fletcher Building, up 4c to 334, GDC Communications down 20c to 150, Lion Nathan down 17c to 590, meat company Richmond down 10c to 230, and Goodman Fielder down 6c to 200 after a takeover bid by Graeme Hart's Rank Group was announced on Friday.

Falls outnumbered rises 52 to 35 on 133 stocks traded.

Wall St was little better as unease about North Korea and a bearish report on the microchip market put the dampener on the crumbs of a positive consumer report.

The Dow Jones industrial average closed down 104.55 points, or 1.22 per cent, at 8433.85. The broader Standard & Poor's 500 Index dropped 12.08 points, or 1.34 per cent, to 889.50, and the technology-laced Nasdaq Composite Index fell 36.97 points, or 2.64 per cent, to 1362.58.

- NZPA