NZ stocks: Telecom drags NZ sharemarket lower

Telecom's share slump continued to drag the top 50 share index lower today, although the rest of the market was mixed.

Telecom dropped another 5c to a three-year low of 463, bringing its loss to nearly 20 percent since news broke eight days ago it was facing a tougher regulatory regime. The plunge has wiped $2.2 billion off its value.

Turnover was lighter today at just over $60m - less than a quarter of yesterday's hectic selling.

"The heat seems to have come out of it," said ASB Securities broker Stephen Wright. Senior executives were on a road show in the US trying to reassure investors.

The benchmark NZSX-50 gross index dropped 17.32 to 3720.82, while the NZSX all capital index ended 5.80 lower at 1070.27.

Total market turnover was around $132m, according to early data.

Elsewhere, market number two Contact Energy recovered from a low of 785 to end just 2c down at 808. The power company said yesterday it was delaying a vote on its proposed merger with Australia's Origin Energy by two months after delays in gaining regulatory approval for the deal.

Today, the Takeovers Panel said it had not granted all waivers it had been requested to approve.

Fletcher Building recovered from yesterday's weakness after its well-regarded chief executive Ralph Waters announced he was stepping down. It gained 3c to 966.

Mr Wright said investors realised the company had strong fundamentals plus a good order book and management culture.

Savings and wealth industry stocks that will benefit from Tuesday's Australian budget continued to prosper. AMP rose 7c to 1214 and ANZ bank rose 25 to 3540. However, Westpac fell 51 to 2990 on profit taking and possibly affected by National Australia Bank's result.

Stocks with Australian earnings were mostly underpinned by the fall of the exchange rate to a 4-1/2 year low. But some that had had good runs encountered profit taking including Nuplex, down 4c to 665 and Freightways, down 22c to 393.

The country's second biggest listed property investor, Macquarie Goodman Property Trust fell 1c to 126 despite reporting a 98 percent rise in full year profit to $35.1m.

Food company Goodman Fielder, lifted 6c to a new high of 276.

Air NZ fell 3c to 129 while Auckland Airport fell 6c to 206.

Lion Nathan gave back much of yesterday's gain, with a 24c fall to 1001.

Methven, with good exports, rose 8c to 142 on light volume, while Wellington Drive rose 2c to 49c.

Lyttelton Port fell 10 to 2004 and Briscoe succumbed to profit taking, off 5c to 151.

- NZPA