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The New Zealand sharemarket weakened as Air NZ shares dived and a lack of news and softening economic data dented sentiment.
Air NZ shares plunged 25c to 265 as nearly 46 million shares worth $123.8 million changed hands.
The fall was prompted by Qantas selling its 4.2 per cent stake, a leftover from the two airlines' failed plans for a strategic alliance.
Qantas sold the shares for $2.70, all to institutional investors.
Brokers said the sell-off was expected, after Qantas converted its redeemable shares to ordinary ones earlier in the year.
Forsyth Barr broker David Price said the airline's story was still a strong one. '
"Clearly there was a big line of stock that's been placed; it will take some time to digest but I think you'll see it recover."
Air NZ aside, Mr Price said volumes had been quite light and sentiment flat.
"You get a deal done at a discount like that, people have to find the funds somewhere, so that always had the market heading into negative territory before we started.
"But a combination of a few jittery comments offshore about credit markets, combined with a weak consumer confidence number out this morning, high interest rate, high currency -- these things have taken their toll."
The market was down for a fifth consecutive day, with the NZSX-50 losing 1.14 per cent or 48.76 points to 4203.26.
Falls heavily outnumbered rises 85 to 16 on 140 stocks traded, with the turnover totalling $202 million.
Top stock Telecom was down 6c to 446, Contact lost 5c to 905, Fletcher Building was down 7c to 1243, Fisher & Paykel Healthcare lost 6c to 326, and SkyCity was off 8c to 508.
Others among the sea of red were Freightways down 15c to 395, Infratil down 6c to 318, Auckland Airport down 3c to 318, and Trustpower down 109c to 850.
Tourism Holdings fell 6c to 258 after suitor MFS Living and Leisure reiterated its offer was final and that it was not interested in buying certain assets if the total takeover failed.
One of the best performers was Northport, up 10c to 340 as port stocks enjoy a resurgence. Port of Tauranga fell 11c to 715 after a bull run, indicating profit-taking.
Across the Tasman, Australian shares also fell for a fifth straight session, down 1.5 per cent on worries about a sluggish US economy for US-exposed exporters.
In the US stocks closed down as higher bond yields raised concerns about borrowing costs and more fallout from the subprime mortgage market kept investors on edge.
But a drop in oil prices eased worries about inflation and takeovers in health care and chemicals increased optimism about share valuations, limiting the market's decline.
The Dow Jones industrial average slipped 0.11 per cent, to end at 13,337.66. The Nasdaq Composite Index declined 0.11 per cent, to close at 2574.16.
- NZPA