NZ stocks: Market softens on US fall, job ads/retail data

12.00 pm

The New Zealand sharemarket eased a tad this morning in response to a dip on Wall St on Friday and the release of weak job ads and retail sales figures locally.

The benchmark NZSE-40 index was down 12.07 points, or 0.58 per cent, at 2061.08 by just after 11am. Turnover was worth $35 million.

ASB Securities broker Andrew Kelleher said the tone in the market was "fairly muted", with investors reacting to a fall in US markets and local data.

ANZ's monthly Job Ads survey, out this morning, showed the number of jobs advertised in major New Zealand newspapers plunged by 8 per cent in November -- the largest month-on-month fall since May 1998.

Job ads have now been declining for the past four months, raising fears of shrinking employment.

"Recent trends in job advertising suggest that employment growth is slowing and may even have stalled," ANZ chief economist David Drage said.

"Given the magnitude of the latest fall, we would not be surprised to see employment decline in the December quarter."

Mr Kelleher said today's data had analysts questioning whether or not the local economy will pick up, as expected, in the first or second quarters of 2002.

"There have been a number of commentators picking improved GDP growth prospects for next year but we are certainly not seeing it in those job ads at the moment.

"It doesn't bode as well as we would like, moving forward.

"It (had) looked like the economy might do quite well next year, and hence the sharemarket would do better."

Among the stocks to lose ground this morning, Fisher and Paykel's healthcare unit made up the lion's share of early turnover at $23 million. The stock was down 55c at 1645, while its sister stock, Fisher and Paykel Appliances slipped 10c to 955.

Telecom was down 4c at 505, as was Sky City at 646, Sky TV lost 14c to 366, Auckland Airport eased a cent to 392, Carter Holt was down 2c at 174 and Contact Energy was down 2c at 400.

In all, falls outnumbered rises by 37 to 23 among the 107 stocks changing hands in the morning session.

Hallenstein Glasson was untraded at 298 after going ex-dividend to the tune of 9.5c, as was TrustPower at 340 after losing a 6c dividend. Transport operator Mainfreight fell 3c to 145 after shedding its 3c dividend.

On the upside, Air New Zealand A and B-shares added a cent each to 34c and 35c respectively, Baycorp was up 20c at 1180, Owens Group was up 6c at 135 and Waste Management added 4c to 281.

Retail sales, released mid-morning, were another key indicator of how well the economy was holding up, Mr Kelleher said.

Seasonally adjusted retail sales fell by 0.1 per cent in October, Statistics New Zealand said, against economists' expectations of a 0.2 per cent rise.

In the US on Friday, stocks fell as a jump in the US unemployment rate to a six-year high tempered hopes for a swift economic rebound next year and spurred investors to lock in profits after this week's rally hoisted the Dow Jones industrials back over the key 10,000 mark.

The total number of job losses in the past two months -- almost 800,000 -- was the highest in more than 20 years, pointing to more interest-rate cuts to combat recession, analysts said. The bleak numbers raise the likelihood of an eleventh rate reduction by the Federal Reserve at the year's final policy-setting meeting on Tuesday.

The tech-packed Nasdaq composite index dropped 33.97 points, or 1.60 per cent, to end at 2021.30. The blue-chip Dow Jones industrial average fell 49.68 points, or 0.49 per cent, to 10,049.46. The broad Standard and Poor's 500 index lost 8.79 points, or 0.75 per cent, at 1158.31.

- NZPA