NZ sharemarket falls early

The New Zealand sharemarket fell away in early trading from an 18-month high reached yesterday, with market heavyweights Fletcher Building and Contact Energy both retreating from multi-month peaks.

Around 10.15am the benchmark NZX-50 index was down 10.6 points to 3314.48, having yesterday closed up 16.2 points, its highest since September 2008.

Fletcher Building fell 7c early to 843, reversing most of the 8c gain it made yesterday when it reached a three-month high. Contact Energy fell 5c to 645, having risen 7c yesterday to a seven-month high.

Sky TV, which confirmed it had reached agreement with the Sanzar rugby unions on broadcast arrangements between 2011 and 2015, fell 4c early to 530. NZ Refining Co was down 5c to 389 and Auckland Airport was down 2c to 197.

Restaurant Brands lifted 5c to 215, an eight-year high. The company yesterday reported a full-year net profit, excluding non-trading items, up 70 per cent to $19.9 million.

Fisher & Paykel Healthcare lifted 3c to 335 and Ebos Group gained 2c to 652. Telecom was unchanged on 224.

In the United States, stocks fell in a broad late-day drop after a top Federal Reserve official said interest rates should not stay low for much longer, giving investors an excuse to take profits.

A speech by Kansas City Federal Reserve Bank President Thomas Hoenig drove afternoon selling after he said keeping interest rates too low for too long would encourage risky financial behaviour.

But Hoenig was the sole dissenter at the most recent Fed meeting, advocating higher rates.

Scott Marcouiller, senior equity market strategist at Wells Fargo Advisors in St. Louis, said the real reason for the US market fall was that it was a short-term extended market that was vulnerable to short-term pullbacks.

The Dow Jones industrial average fell 0.7 per cent to 10,897.52, the Standard & Poor's 500 Index slipped 0.6 per cent to 1182.45, and the Nasdaq Composite Index lost 0.2 per cent to 2431.16.

- NZPA