The local sharemarket closed down fractionally yesterday as buyers continued to sit on the sidelines, deterred by volatility in overseas markets after last week's China shock.
The NZX-50 index eased 0.05 per cent, or 1.97 points, at 4033.36 - a big improvement on Monday's 1.57 per cent slump.
It was the second day in a row that local investors had been hanging back, said Stuart Eaves, of Wellington brokers Waddell, Johnston, McCarthy.
The New Zealand market got it wrong on Friday with investors being overly optimistic and sending the NZX up while other markets fell, he said.
That resulted in a big selloff on Monday which continued yesterday morning.
But a rebound on Asian markets - which saw Australia, Hong Kong and Japan in positive territory for the first time in five days - helped steady trading on the NZX by the end of the day.
The ASX-200 surged 118 points, or just over 2 per cent, to 5771.8, helped by a recovery in big mining stocks.
Locally there was some momentum for exporters due to the dollar's sharp fall, Eaves said. Both F&P Appliances and Healthcare rose yesterday.
The dollar was trading at US67.99c last night, having shed almost 4c since last Tuesday.
