KEY POINTS:
The re-emergence of credit worries in the United States, making Wall Street shed over 2 per cent overnight, saw the local sharemarket open sharply lower today.
The benchmark NZSX-50 index , which has followed up a six-day losing streak on August 17, with a five out of six session gaining run, today swung sharply down.
At 10.05am the NZSX-50 was down 33 points, 0.8 per cent, to 4067.5.
Sentiment in the local market was not helped by news that NZAX-listed Property Finance was not able to stave off receivership.
The market was led down by the heavyweights. Telecom was down 5c to 410, Fletcher Building off 19c to 1146, and Contact Energy 13c to 940. The latter rose 9c yesterday after reporting a 14.7 per cent fall in annual profit.
Goodman Fielder fell 12c to 283 after its result yesterday.
The only stock with a green up arrow against its name in the top 50 was Pumpkin Patch, rising 5c to 355. Investors were probably betting on a lower New Zealand dollar benefiting the clothes exporter. The kiwi was also hit heavily by credit crunch concerns, dropping below US70c today.
Among the heavier falls, Sky City was down 9c to 448, AMP 130 to 1070, Nuplex 11c to 680, Fisher & Paykel Appliances 8c to 360, NZX 10c to 1010 and Tower 8c to 220.
By 10.15am the index was down 49 points, 1.2 per cent to 4051.
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US stock indices tumbled more than 2 per cent after Merrill Lynch warned that ailing credit markets would hurt bank profits, while reports showing eroding consumer confidence and falling home prices added to concerns about the economy.
The mood worsened late in the day after the release of minutes from the Federal Reserve's August 7 policy meeting.
The transcript showed growing concern among Fed officials about the housing market and its effect on consumers even before credit market turmoil picked up speed.
Reflecting unease that the fallout from the subprime debacle is spreading, shares of State Street Corp, the world's biggest institutional money manager, fell 4.3 per cent on worries about the company's US$20 billion ($29 billion)-plus in commitments to asset-backed commercial paper programmes.
The Dow Jones industrial average skidded 280.28 points, or 2.10 per cent, to 13,041.85. The Standard & Poor's 500 Index dropped 34.43 points, or 2.35 per cent, to 1432.36 and the Nasdaq Composite Index tumbled 60.61 points, or 2.37 per cent, to 2500.64.
- NZPA