NZ stocks: Sharemarket falls as interest rates rise

12.00pm

The sharemarket fell this morning following an interest rate hike by the central bank.

By 11.35am this morning, the benchmark NZSX-50 gross index was down 16.85 points at 2594.36, while the NZSX-All capital index was down 5.28 points at 870.24.

Bellwether stock Telecom was down 5c at 543 on turnover worth $13.9 million.

Total market turnover by 11.35am was worth $26.6 million.

As had been widely expected Reserve Bank Governor Alan Bollard hiked the Official Cash Rate this morning by 25 basis points to 5.75 per cent.

Dr Bollard also signalled a series of further rises later this year to counter a predicted inflation shock.

In corporate news this morning, Tenon has restructured its board following Rubicon's success last week with its partial takeover offer.

Tenon chairman Sir Dryden Spring has resigned and been replaced by Rubicon and Guinness Peat Group director Tony Gibbs.

Tenon was unchanged at 194 while Rubicon was also unmoved at 84c.

In other news, Sky City Entertainment announced it has acquired a 95.75 per cent stake in Sky City Leisure, sparking a compulsory acquisition of the remaining shares.

Sky City Entertainment was down 4c at 465, while Sky City Leisure was unchanged at 79c.

Of the 120 stocks traded by 11.35am this morning there were 24 rises and 37 falls.

Stocks on the move included Carter Holt Harvey down 3c at 198, Contact Energy down 6c at 575, Fisher & Paykel Appliances down 5c at 447, F&P Healthcare up 5c at 1320, Michael Hill Jeweller down 7c at 584, NZX down 20c at 820, Nuplex down 5c at 510 and Restaurant Bramds down 4c at 116.

The Dow Jones industrial average ended down 64.08 points at 10,368.44. The Standard & Poor's 500 Index closed down 10.88 points at 1,131.30. The Nasdaq Composite Index fell 32.92 points to 1,990.61.

In Britain, the FTSE 100 fell 15.3 points to 4,489.5.

- NZPA