KEY POINTS:
The sharemarket continued yesterday's drift in early trading today as investors fretted about the prospect of a yet higher dollar and interest rates.
The benchmark NZSX-50 index was down 2.15 points to 4238.21 at 10.20am.
Higher than expected inflation in the June quarter raised the prospect of another rate hike next week and propelled the kiwi dollar to a new record and to within spitting distance of US80c.
Market leaders were mixed with Telecom down 1c at 466, Fletcher Building unchanged on 1237 and Contact Energy up another 3c to 912.
Contact Energy rose 8c yesterday while Trustpower gained 10c to 839, as winter temperatures increased power usage.
Trading in Telecom dominated with $30m of the $53m market total. Rises were outnumbered 13 to 17 among the 68 stocks traded.
Tourism Holdings gained 6c to 275 as MFS Living and Leisure's takeover got major traction. Major shareholders agreed to the 280c/share offer to lift MFS's stake to 58.5 per cent.
US investor Sterling Grace, with 19.9 per cent, accepted along with fund manager AllianceBernstein, which manages 12.4 per cent for AXA. Yesterday, 4.62 per cent shareholder Accident Compensation Corporation accepted the bid.
Other top-50 moves of note included Infratil, down 5c to 310, Rakon, down 5c to 470, PGG Wrightson, down 4c to 175 and Nuplex, down 4c to 711,
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On Wall Street, the broader US stock market fell on worries that troubles in the subprime mortgage market may spread, but optimism about earnings at multinational companies pushed the Dow to nearly 14,000.
The Dow Jones industrial average rose 43.73 points, or 0.31 per cent, to 13,950.98. The Standard & Poor's 500 Index fell 2.98 points to 1549.52 and the Nasdaq Composite Index fell 9.67 points to 2697.33.
- NZPA