12.00pm
The New Zealand sharemarket slid today on news that its biggest component, Telecom, would post a lower first quarter profit than some in the market expected.
By mid-morning the NZSE-40 was down 1.79 per cent, or 36.47 points, at 1999.72, while the top-10 index was down 2.98 per cent at
899.43.
New Zealand's largest listed company fell more than 7 per cent today after a warning last night it expected after-tax earnings of $145 million to $150 million for the first quarter.
That was well down on market expectations of $165 million.
By mid-morning Telecom's shares had slid a further 11c from their opening price to trade down 41c (from last night's close) at 481. They experienced brisk trade of 9.06 million stocks worth $44.90 million -- about two thirds of the $61.23 million total turnover.
In another blow, Telecoms Commissioner Douglas Webb set the price of interconnection between Telecom and TelstraClear's networks at 1.13c per minute -- below the range set in the commissioner's draft ruling.
However, Sam Macdonald of Direct Broking said the interconnection pricing issue was not really a negative as it did not significantly affect revenue.
Telecom saw buying today as well as selling, indicating the telco's punishment could be short-lived.
He did not think Telecom was caught up in negative sentiment aimed at financial services company Tower, which saw 44 per cent of its value wiped out yesterday following its forecast of a loss of up to $40 million for the year.
"I think Telecom has reaped the rewards of a flat earnings result from Telstra, if anything it's made Telecom the preferred telco in Australasia," Mr Macdonald said.
TelstraClear, 58 per cent-owned by Telstra, revealed yesterday it lost $106.7 million in the six months to June 30.
Tower, down a further 3c today at 198, could continue to slide on uncertainty about its Australian business, he said.
"There were a few local buyers yesterday afternoon around the 202 mark, they bought a couple of million there. The problem really is the aussie side, and I would say that's where the selling's coming from."
Shares in casino operator Sky City shot up nearly 4 per cent today after the company announced a special dividend, share buyback and plans for a new hotel.
After opening up 4c at 765, Sky City shot up to 785.
Elsewhere on the market, AMP gained 13c to 1439, Baycorp Advantage was up 5c at 335, Axa Asia was up 5c at 280, and Westpac lost 1c to 1570.
Blue chip Auckland International Airport was down 8c at 530, Carter Holt Harvey lost 3c to 170, The Warehouse was up 6c at 750, Fisher & Paykel Healthcare lost 10c to 1115, Fletcher Building was down 1c at 306 and Tranz Rail gained 3c to 152.
Independent Newspapers Ltd was up 3c at 323, while its pay-television asset Sky TV gained 1c to 365.
BIL International was up 2c at 64c after a London paper speculated that investment company Orb Estates was preparing to snap up BIL's 46 per cent stake in British hotel chain Thistle.
There were 30 rises and 26 falls on the 100 stocks traded.
On Wall St, the technology-loaded Nasdaq Composite Index soared 53 points, or 3.91 per cent, to 1413; the blue-chip Dow Jones industrial average leaped 171 points, or 2.02 per cent, to 8688; and the broad Standard & Poor's 500 index jumped 20 points, or 2.23 per cent, to 920.
- NZPA
12.00pm
The New Zealand sharemarket slid today on news that its biggest component, Telecom, would post a lower first quarter profit than some in the market expected.
By mid-morning the NZSE-40 was down 1.79 per cent, or 36.47 points, at 1999.72, while the top-10 index was down 2.98 per cent at
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