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Auckland electricity and gas network company Vector has been pitched out of the sharemarket's top 10 list in favour of Lloyd Morrison's Infratil, a company half the size, whose shares have been hit even worse in recent market turmoil.
The change is a result of New Zealand Exchange's March quarterley index review which also sees Air New Zealand replaced in the NZX-15 by Nuplex, a company of little more than one-third its size.
The NZX-10 Index and the NZX-15 Index are made up of "the largest and most liquid companies quoted on the NZX market".
Vector's shares have fallen about 17.5 per cent in the past three months and were yesterday nudging their life low of $1.81 plumbed last week before closing flat at $1.83.
Infratil shares have lost almost 25 per cent of their market value over the same period, closing 2c lower at $2.16 yesterday giving the company a market capitalisation of $957.55 million against Vector's $1.82 billion.
However, NZX calculates its indices based on companies' "free float" which excludes large stakes deemed to be held by long term majority or "cornerstone" investors.
In Vector's case, only 25 per cent of its shares are listed, the balance are held by local authorities via the Auckland Energy Consumer Trust.
Similarly, 77 per cent of Air NZ's shares are held by the Government, which reduces the weighting they carry when NZX calculates its indices.
Shares in Air NZ, which has a market cap of $1.4 billion, closed 8c lower at $1.40 yesterday, while those in Nuplex which has as market cap of $505 million closed 22c lower at $6.24.
Shares in most companies on the NZX-50 index closed lower yesterday in what was the fourth consecutive down day for the benchmark index.
Markets around the world have again been in retreat amid speculation that the US is either on the brink or currently in the grip of recession. Financial stocks, including Australia's big bank,s have also been sold down amid concerns there is still more sub-prime fallout yet to be revealed.
The NZX-50 closed 27 points, or 0.79 per cent lower at 3520.46, taking its losses for the past four days to 2.7 per cent and almost 13 per cent for the year to date.
Broker Grant Williamson of Hamilton, Hindin Greene said while the local market was not suffering large one-day declines seen overseas, it was being ground down in steady and gradual losses. "Because of the state of the Australian market, we're not seeing Australian buyers in the New Zealand market, and that is leading to less buying support here."
