KEY POINTS:
The New Zealand sharemarket had a dour day today as speculators watched the troubles of giant investment bank Lehman Brothers unfold in the United States.
Just 11 companies in the top 50 gained ground on limited turnover while the bulk slid backwards, with Freightways recording the biggest percentage drop of 6.94 per cent to finish on 335.
The NZSX-50 benchmark closed down 41.786 points, or 1.243 per cent at 3319.902. There were 25 rises and 66 falls and turnover was worth $82.96 million.
Grant Williamson, partner at Hamilton Hindin Greene, said the negative day was the result of reaction to news over the weekend that US investment bank Lehman Brothers would possibly have to file for bankruptcy. It did this today.
Otherwise there was little news on the local front and the New Zealand dollar was not up to much during the day, he said.
With the US market opening at 2am tomorrow NZ time, and the anticipated reaction to the Lehman Brothers crisis, it was very much a case of wait and see, he said.
Investors were expecting a rocky ride with the US market.
"They are being cautious and putting some money on the sidelines to see what happens tonight."
Mr Williamson said blue chip stocks had been hit hardest, such as Fletcher Building, which fell 34c before jumping at the end of the day to finish down 29c at 736.
Telecom dropped 7c, before it recovered 3c to finish at 293.
Telecom was at levels not seen since 1993, Mr Williamson said.
"Fletcher Building and Telecom always have a large amount of foreign shareholders, and they are nervous about what's happening in the States," Mr Williamson said.
Later in the week it would also be a case of following events in the US, but as New Zealand did not have any real exposure to finance companies, it was a little more insulated from overseas events, such as those that could hit Australian investment banks.
Contact fell 11c to 890. Fisher & Paykel Healthcare was down 6c at 316 and the appliances stock was down 4c at 177. The Warehouse rose 2c to 330 and Tourism Holdings rose 4c to 140.
On Friday the Dow Jones industrial average was down 0.10 per cent at 11,421.99. The Standard & Poor's 500 Index was up 0.21 per cent at 1251.72. The Nasdaq Composite Index was up 0.14 per cent at 2261.27.
For the week, the Dow finished 1.8 per cent higher while the S&P added 0.8 per cent and the Nasdaq edged up 0.2 per cent.
- NZPA
