NZ sharemarket follows world equities down

NZPA

Wednesday 3rd August 2011

The New Zealand sharemarket fell sharply in early trading, after big drops on world equity markets as global manufacturing data this week indicated big industrial economies are on the verge of stalling.

Around 10.15am the benchmark NZX-50 index was down 20.67 points to 3376.33, on top of a 16.8-point fall yesterday.

Among leading stocks Fletcher Building lost 11c early to 791, Contact Energy dropped 3c to 512, and Telecom edged down 0.5c to 267.

Mainfreight was down 5c early to 1055, Port of Tauranga lost 5c to 925, Fisher & Paykel Healthcare fell 4c to 251, and NZX dropped 4c to 233.

Shares losing 2c early included Air New Zealand, to 116, Infratil to 180, NZ Oil & Gas to 67, Ryman Healthcare to 270, Skellerup to 124, Sky TV to 579, Tower to 147, and Vector to 238.

OceanaGold gained 6c to 296 and Hallenstein Glasson lifted 5c to 360.

In the US, the Standard & Poor's 500 Index turned negative for the year as the wrangling over the US debt ceiling faded and investors turned their attention to the stalling economy.

The broad-based index fell for a seventh day and crashed through its key 200-day moving average in an ominous sign for markets. The seven days of losses mark the longest losing streak since October 2008.

The selloff accelerated into the close as volume jumped well above average.

Industrial and consumer discretionary shares, which are sensitive to signs of weakness in the economy, were among the hardest hit.

The Dow Jones industrial average dropped 2.2 percent to 11,866.62, the S&P dropped 2.6 percent to 1254.05, and the Nasdaq Composite Index dropped 2.8 percent to 2669.24.

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