NZ stocks: Telecom tests 6-year low in light trade

The New Zealand sharemarket was weaker overall yesterday, but came off lightly in comparison to the dive taken by overseas indices.

The NZSE-40 closed down 28.26 points - 1.46 per cent - at 1901.41, while the NZSE-10 shed 17.78 points to 826.50.

In the US, the tech-dominated Nasdaq was knocked back by 7.2 per cent.

ABN Amro broker Nigel Scott said the NZSE escaped further punishment because of its light turnover - just $72 million - a healthy boost in the kiwi dollar and positive GDP figures.

"Even though the sharemarket has come down it hasn't fared as badly as other markets.

"Currency has probably been the more major feature," he said. "A lot of people have ruled off for the year because on the settlement side they won't be able to settle between Christmas and New Year, so you have got slightly fewer participants."

The biggest losers yesterday were Telecom, which tested a new six-year low of $4.96 in early trade before closing down 20c at $5 on global telco woes and uncertainty about its expansion plans into Australia, and Fisher & Paykel, which was hit by profit-taking following its highs this week after it announced it was splitting its healthcare and whiteware divisions. Fisher & Paykel closed down 30c at $7.80.

"It is really just taking off the premium the market put on it for that one day around the split information," Mr Scott said.

"People are now realising that there is a bit of time to actually go until the full proposal and activity is on the table for shareholders," he said.

Fletcher Energy also lost out on the back of the rallying kiwi and weakness in its US associate Capstone Turbines. Energy closed down 23c at $8.12.

Kiwi Income Property Trust closed unchanged at 92c after announcing it had plans for a full takeover bid for fellow real estate investor Kiwi Development Trust.

Stocks such as Sky TV reacted positively to the surge in the kiwi, closing up 8c at $3.08. Tower also gained, closing up 10c at $5.20, while Tranz Rail picked up 5c to $3.55 and Sanford gained 2c to $4.82.

- NZPA