NZ stocks: Telecom pullback weighs market down

12.00 pm

Telecom stock pulled back a little this morning following its strong run last week and that weighed the market down.

The NZSE-40 index was off 3.54 points at 2109.97 at 11.40am. Turnover was typically light for a Monday morning with trade in Telecom comprising $6.3 million of the total of $12.9 million.

Telecom, with a 22 per cent index weighting, was down 4c to 541.

ABN Amro broker Nigel Scott said it was not surprising there was some profit-taking in Telecom given its strong run so far this year when it has risen on all seven trading days of the year to date for a 9 per cent gain.

US stocks fell on Friday, with the blue-chip Dow falling below the key 10,000 level, after a downbeat speech by US Federal Reserve chairman Alan Greenspan and a slew of dismal corporate news dimmed investors' hopes for a quick economic turnaround.

Mr Scott said New Zealand interest rates could fall in response to Dr Greenspan's comments and that might be a boost for equities.

"New Zealand has always benefited from that scenario because you tend to get a bit of asset allocation," Mr Scott said.

The market was now looking for the December quarter results for direction with Carter Holt Harvey the first major to kick off on January 22. Carter Holt was down 1c at 181.

The Warehouse, which will shortly report on its Christmas sales, was up 5c to 680.

Tower, ex a 14c dividend, was down 11c to 500, an effective 3c gain.

Fletcher Building continued to show strength, and was up 5c at 297.

Fisher and Paykel Healthcare was down 10c at 1630 and Sky City was up 1c at 619.

There were 31 rises and 37 falls among the 110 stocks traded.

- NZPA