New Zealand shares fell ahead of earnings season which begins tomorrow, with Metro Performance Glass and Fletcher Building down while SkyCity Entertainment Group and Scales Corp rose.

The S&P/NZX 50 Index fell 0.78 of a point, or 0.01 per cent, to 7,066.27. Within the index, 24 stocks dropped, 22 rose and four were unchanged. Turnover was $115 million.

"It's a bit of a phony war awaiting results season," said Matt Goodson, managing director at Salt Funds Management. "The December quarter was quite weak for the New Zealand market, and really what was driving that was a sharp rise in bond yields from all-time record lows, and the heavy weighting of bond, property type stocks in our market, then January was really a bit of a rebound."

Metro Performance Glass led the index lower, down 3.2 per cent to $1.50. The Auckland-based company, which has more than half the country's glass processing market, saw its shares plunge 18.5 per cent last Friday after saying annual net profit was likely to be similar or even lower than the prior year's $20.5m as local sales lagged behind expectations and costs were higher than expected.


"They staged a bit of a rebound yesterday after that very disappointing guidance update, but they're really weakening off again today as people reassess what the sustainability through the cycle is going to be," Goodson said.

Fletcher dropped 2.8 per cent to $10.11, Metlifecare fell 2 per cent to $5.45, and Heartland Bank declined 1.3 per cent to $1.56.

SkyCity was the best performer, up 4.2 per cent to $3.74 ahead of its earnings announcement tomorrow. The stock had been sold off sharply over the past few days with investors nervous ahead of the result, Goodson said.

Scales Corp rose 3.3 per cent to $3.47, Australia & New Zealand Banking Group advanced 2.3 percent to $30.59, and Westpac Banking Corp gained 1.9 per cent to $33.78.

Infratil gained 0.5 per cent to $2.88. In a market update, the infrastructure investor was upbeat about its investment in US renewable energy development company Longroad Energy Holdings, despite President Donald Trump's election promises to boost coal.

Spark New Zealand dipped 0.4 per cent while TeamTalk fell 1.3 per cent to 74 cents. TeamTalk says a proposed $22.7m takeover offer from Spark is hostile, highly conditional and recommended shareholders take no action pending further communication from the board.

Outside the benchmark index, Fliway Group dropped 3.4 per cent to $1.13. First-half profit dropped 39 per cent to $2.2m as the impact of a major customer's exit and higher freight costs caused by last November's Kaikoura earthquake weighed on the transport and logistics group. The transport group expects its second-half performance will be an improvement on the prior year, with sales growth a priority as it "looks to sell to capacity in its network and increase relationships with existing customer and business partners."

Hellaby Holdings was unchanged at $3.57. It will delist from the NZX by March 8, after ASX-listed auto firm Bapcor succeeded in its $352m takeover of the diversified investment group earlier this month.