New Zealand shares followed Wall Street lower, led by Xero and other growth stocks, as investors worried global economic growth is stalling. Kathmandu Holdings and Air New Zealand paced the decline.
The NZX 50 Index fell 55.086 points, or 1.1 percent, to 5170.053, its lowest level since August. Within the index, 42 stocks fell, four rose and four were unchanged. Turnover was a lighter-than-usual $86.1 million, with markets in Japan closed for a public holiday.
The benchmark index followed Wall Street lower, with the tech-heavy Nasdaq 10 dropping 2.5 percent on Friday, while the S&P 500 Index slipped 1.2 percent and the Dow Jones Index fell 0.7 percent on fears global economic growth was stalling. Poor economic data out of Germany has stoked concern Europe may slip back into recession, while last the week, the International Monetary Fund cut its global growth forecast for 2015 to 3.8 percent from 4 percent and warned geopolitical tensions posed a risk to "frothy" equity markets.
Xero dropped 6.3 percent to $17.95, paring its intraday decline to as low as $17.75. The cloud-based accounting software firm has fallen some 61 percent from its March high of $45.99, as investors question high valuations compared to future profit growth.
Meanwhile, an escrow period for the stock, after it sold 9.95 million shares at $18.15 a
piece in a $180 million capital raise last October, is coming to a close this week.