NZ stocks: NZX follows overseas markets down

The New Zealand sharemarket tumbled in early trading in the wake of falls of more than 3 per cent in European and United States stock indices as analysts ratcheted back their earnings expectations.

The sharp fall in stocks around the world, and a 9 per cent drop in crude oil followed a jump in troubled loans at Bank of America and renewed economic jitters which cooled hopes that the worst of the global slowdown was over.

Among leading shares in this country Telecom was down 5c early to $2.45, Fletcher Building dropped 16c to $6.39, and Contact Energy slipped 4c to $5.74.

Around 10.15am the benchmark NZX-50 index was down 29.35 points, or 1.1 per cent, to 2669.45, having lost 12.5 points yesterday.

Other stocks to fall early included Sky City, down 7c to $2.86, Freightways down 6c to $2.65, Sky TV down 5c to $4.20, Mainfreight down 5c to $4.40, Tower down 3c to $1.29 and NZX down 3c to $6.85.

In the US, the Dow Jones industrial average this morning dropped 3.6 per cent to 7841.73.

- NZPA