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MARKET CLOSE: NZX50 slumps early and aftershocks cut off recovery

Monday 13th June 2011

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New Zealand's benchmark NZX50 index fell nearly 14 points today, but recorded its biggest fall in the first half hour of trading, two hours before Christchurch was slammed by more big aftershocks.

The NZX50 finished at 3476.684 points, down 13.942 points (0.399%) on its close on Friday, when it edged up 1.9 points.

But it had actually fallen lower than that in early trading, and was bumping along after recovering about half the lost ground when it began slipping again just before noon and kept on diving to an intraday low of 3474.03 points, 15 minutes before the first of the afternoon's aftershocks hit.

The series of tremors sliced and diced the index's recovery from that low, and it finished with the lowest close in nearly two months, not helped by the market holiday across the Tasman, or the Asian markets following a weak lead from Wall Street.

There were 60 falls and only 14 rises in the prices of the 116 stocks traded. The turnover of 28.9 million shares was valued at $69 million.

SkyCity (NZX: SKC ) shares rose in early trading after it was revealed at the weekend that the company was negotiating with the Government over a proposal to build a $350 million convention centre in Auckland. It has announced that it wanted the Government to allow it more gaming tables and machines, and to extend its casino licence.

The aftershocks had a silver lining for Fletcher Building (NZX: FBU ), up 1c to $8.67, as the company has extensive contracts to manage reconstruction around Christchurch.

Air New Zealand (NZX: AIR ) dodged the clouds of ash from an erupting volcano in Chile to keep flying while rival airlines cancelled many trans-Tasman and domestic flights, but its shares finished on par at $1.05 each.

Shares falling in today included Restaurant Brands (NZX: RBD ), down 2c to $2.56, NZ Refining Co (NZX: NZR ) down 5c to $3.85, Hallenstein Glasson (NZX: HLG ) down 7c to $3.83, Contact Energy (NZX: CEN ) down 2c to $5.82, and cornerstone stock Telecom (NZX: TEL ) down 4.5c to $2.27.

Fisher & Paykel Healthcare (NZX: FPH ) was among the few early risers, adding 2c to $2.95.

In the United States, the Dow Jones industrial average and the Standard & Poor's 500 Index closed out their sixth week of losses on Friday as further signs of a global economic slowdown set the stage for more losses ahead.

The deepening gloom raised the prospect for the S&P, which suffered its worst week since August 2010, to break below the year's low of 1250 this week.

The Nasdaq wiped out its yearly gains on Friday and also posted its biggest weekly decline since August 2010, as the latest deterioration in sentiment came on fear of flagging Chinese growth and fresh worries about Greece's debt crisis.

The Dow fell 1.4% to 11,951.91, the S&P 500 slid 1.4% to 1270.98, and the Nasdaq Composite Index tumbled 1.5% to 2643.73 at the close.

For the week, the Dow was down 1.6%, the S&P 500 was off 2.2% and the Nasdaq was down 3.3%.

European shares fell to a three-month closing low and posted their sixth week of losses. The FTSEurofirst 300 stock index dropped 1.4%.



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