Sharemarket finishes down amid disaster worries

File photo / NZ Herald

The New Zealand sharemarket slumped yesterday as the Nikkei 225 index was pounded down nearly 6 per cent, and other regional markets such as the Kospi, Hang Seng and Shanghai Composite weakened in the wake of Japan's continuing tragedy.

At lunchtime, the NZX top 50 index dropped sharply, falling 16 points in just over half an hour as investors recognised potential concerns over the outlook for Japan's already troubled economy - and its future imports.

The NZX-50 fell 0.64 per cent to 3361.2, down 21.64 points from Friday's close, when it was down 23.39 points. Forty million shares were traded, with a total value of $79.8 million.

New Zealand investors struggled to come to grips with the financial uncertainty over the quake and tsunami in Japan, as analysts and commentators pointed to Japan's importance as our fourth-biggest trading partner, taking 8 per cent of the nation's exports.

But the ASB Bank suggested disruption to exports was likely to be limited, and pointed to a bright spot.

"Forestry is New Zealand's second-largest merchandise export to Japan, leaving New Zealand well placed when reconstruction efforts eventually begin," it said.

Telecom was down 5.5c at $1.98.5c and Fletcher Building was down 4c at $8.75 but NZOG was up 1c at 93c.

Tower shares fell 7c to $1.79 after dropping 4 per cent on Friday as the insurer and fund manager disclosed that its costs were likely to be driven up by as much as $20 million by the Christchurch earthquake and its aftershocks.

NZ Refining was initially untraded but rose 3.6 per cent, up 18c to $5.08, after oil refinery shares rose in the wake of Japan's refining capacity being reduced by the quake.

In Australia, the ASX 200 index, which initially shed 78 points, or 1.7 per cent, ended the day down 22 points at 4712, a fall of 0.4 per cent. The main losers were insurance companies and uranium miners.

In the United States, the Dow Jones industrial average rose 59.79 points, or 0.50 per cent, to 12,044.40. The Standard & Poor's 500 Index climbed 9.17 points, or 0.71 per cent, to 1304.28. The Nasdaq Composite Index added 14.59 points, or 0.54 per cent, at 2715.61.

Japanese shares traded in New York fell sharply. The Bank of New York Mellon's index of Japanese ADR's lost 2.1 per cent. Toyota Motor Corp lost 2.1 per cent to US$85.65.

- NZPA