NZ stocks: Telecom leads market lower as profit taking continues

12.10pm

An early slip by market bellwether Telecom led the New Zealand sharemarket lower this morning as investors continued to lock in profits after January's run up.

By 11.30am the NZSX-50 gross index was 2.75 points or 0.11 per cent lower at 2468.76, while the NZSX-40 capital index was 4.15 points or 0.18 per cent lower at 2283.02. There were 28 rises and 38 falls on 114 stocks traded on total turnover of $31.70 million.

"It's opened on a softer note, albeit on low turnover", Amro Craigs Equities retail adviser Bryon Burke said.

"It's just following on from the last couple of days of last week.

Mr Burke said the market this morning wasn't taking its lead from overseas, nor had there been any significant company announcements which would change the tone of the market, "which seems to be one of profit-taking from the January run up".

Telecom, which carries a 26 per cent weighting in the top 50 index, was down 5c to 561 by 11.30am on turnover of $20.77 million.

The telco gives its second quarter result on Thursday, and Mr Burke predicted it would have a "volatile" run on the market until then.

"Trading will be mixed ahead of Thursday's announcement as people take positions."

He said there may be some buying interest among investors looking for the company to give more detail on plans to increase dividend.

On the other hand, "if our dollar weakens you might see some overseas selling in the stock as well".

He said today's dip "may just be the stock coming back into line with the rest of the market", after its gain on Friday, which was contrary to the generally weaker tone.

Meanwhile, other leading stocks were showing some firmness this morning.

Energy generator and retailer Contact was up 5c to 553. "It probably got pushed down too much on Friday," Mr Burke said.

Wood processor Carter Holt Harvey was up 2c to 194, recovering slightly after last week's run up and down. The company saw its shares climb to a fresh high of 217 in advance of its full year result -- which ultimately proved disappointing to investors, who in turn sold the company back down again.

Fisher and Paykel Healthcare raced up 19c to 1229 in late morning trade but sister stock Appliances was down 3c to 379.

Fletcher Building was up 3c to 398, Hallenstein Glasson was up 2c to 289, Sanford was up 6c to 550, and the Warehouse up 4c to 515.

Early losses among the top 50 stocks were mainly in the order of one or two cents, with a few exceptions.

ANZ Banking Group was down 25c to 1990, Port of Tauranga was down 3c to 445, Sky City Entertainment Group was down 3c to 465, Sky TV was down 5c to 510, and Westpac NZ was down 10c to 1785.

- NZPA