NZ stocks: Telecom sluggish despite AAPT news

The sharemarket finished quietly with low volumes yesterday.

"The Olympics are having an impact on the markets - things are increasingly quiet," said Ord Minnett Securities institutional dealer Ian Waddell.

Turnover totalled 18.32 million shares worth $60.47 million, of which $22.9 million was traded by 10 am.

Telecom accounted for $17.24 million of the total, with 2.75 million shares traded.

The NZSE-40 Capital Index was down 21.23 points (1.03 per cent) to 2033.99, while the small companies index, the NZSE-SCI, had a small boost of 3.43 points to 5375.39.

Falls outnumbered rises by 75 to 24 on 150 stocks traded.

"There was a little bit of selling in Telecom overnight and the stock was a bit weaker in the American Depository Receipts market," Mr Waddell said.

Telecom finished down 12c at 625.

Fletcher Energy was unchanged on 892, after rising 13c in the morning to 905 on the back of soaring West Texas crude oil prices.

As well, Fletcher Energy's 11 per cent investment, Capstone Turbine Corporation of the United States, received a second multimillion-dollar order for its microturbine power systems in as many months.

The 100-unit, one-year order is worth about $US3 million.

There was also increasing speculation about an imminent takeover offer for Energy.

"Some of the institutions are talking about a bid for Fletcher Energy coming this week," Mr Waddell said.

The market's tone was slightly negative but that would change dramatically if an offer for Energy was made, he said.

David Fergusson, of Greenslades, said Telecom's poor performance yesterday was a surprise, given that its bid for Australian telco AAPT received formal recommendation from the AAPT board after market close on Friday.

"Obviously that's another key step in bringing Telecom and AAPT together as one company.

"One would have thought it would have been a little more positive for Telecom but obviously we've seen more sellers come out of the woodwork," Mr Fergusson said.

Among the few stocks to rise, Bendon was 10c higher at 175, Frucor gained 2c to 230 and DB Group was up 2c at 330.

The Warehouse gained 5c to 595 and Sky TV was up 5c at 352.

But the losses were greater. Baycorp paid its 10c dividend, dropping 35c to $12.60, and Telstra was down 10c at 400.

Trustpower fell 10c to 300, and Montana slumped 16c to 260.

AMP fell 30c to $21.90, Ports of Auckland dropped 12c to 385, and Air New Zealand A shares were 5c lower at 188.

Fletcher Forests was up 1c at 83.

In New York, stocks closed sharply lower on Friday, after disappointing sales from software maker Oracle sparked a sell-off in technologies and sharply rising oil prices and worries over corporate profits pummelled the blue-chips.

The tech-rich Nasdaq composite index closed 78.63 points, or 2.01 per cent, lower at 3835.23.

The slide cut across most sectors, including internets and telecoms. The Dow Jones index closed 160.47 points, or 1.45 per cent, weaker at 10,927 - its lowest close since August 10.

- NZPA