NZ stocks: Top stocks drop in accelerated selling

The sharemarket's top stocks took a pounding yesterday, with Telecom in particular experiencing a "savage sell-off," said Cavill White Securities equities dealer Alan Wills.

Telecom - which makes up about a third of the sharemarket by volume - plummeted 32c to a new year low of 580 on turnover of three million shares worth $18.1 million.

"It was weak at the opening and selling accelerated throughout the day," Mr Wills said.

"The turnover wasn't enormous but the point of least resistance at the moment is downwards."

Number two stock Carter Holt Harvey sold down as low as 160 during the day but rebounded slightly to close 2c lower than Friday's close at 162.

Fletcher Energy, until recently the star of the sharemarket, dropped 13c to 857, the lowest it has been for more than a month.

"Fletcher Energy is looking very tired as a result of no further news on either the separation or sale process," Mr Wills said.

"There is some feeling that potential bidder Shell may have trouble with the Commerce Commission."

The commission is due to announce on October 13 whether Shell can take over Fletcher Energy, but that deadline had been pushed out three times.

Falls among the leading stocks contributed to the NZSE-40 Capital Index's 26.93 point (1.34 per cent) fall to 1982.65, and the NZSE SCI Capital Index of smaller stocks came off 34.49 points (0.65 per cent) to 5238.49.

Falls outnumbered rises 55 to 31 among the 143 stocks traded, with turnover totalling $68.4 million.

"We had a very sharp sell-off in the market for no apparent reason. The US markets were weak but Australia was marginally ahead, although Japan was off a bit," Mr Wills said.

"All in all, it's been a very, very sad day."

Baycorp lost 10c to 1180, Fisher & Paykel and new listing Frucor both came off 5c to 725 and 222 respectively, and Fletcher Building finished 3c lower at 243.

Fletcher Forests was unchanged at 81, and Lion Nathan was also steady at 480.

Among the few stocks to gain yesterday, Tranz Rail rose 10c to 385 on the back of news it was putting up its prices, The Warehouse was up 5c to 590, Sky TV finished 4c higher at 345 and Montana rose 2c to 317.

US stocks ended the third quarter on a sour note on Friday as a profit warning from computer maker Apple Computer shattered investors' hopes of an end to September's barrage of negative earnings forecasts.

The technology-dominated Nasdaq composite index ended down 105.50 points, or 2.79 per cent, at 3672.82 and the blue-chip Dow Jones industrial average lost 172.33 points, or 1.59 per cent, to close at 10,650.92.

The stock of Apple Computer lost nearly 52 per cent of its value, falling $US27.75 to close at $US25.75

- NZPA