NZ Shares: Local market falls in early trading

The New Zealand sharemarket opened lower this morning, but selling was more muted than seen on overseas markets.

The benchmark NZX-50 index was down 26.2 points or 0.94 per cent to 2768.71 in the first 10 minutes of trading.

Fletcher Building, which had been climbing after hitting its lowest level in three weeks - $6.36 - last Wednesday, lost 12c to $6.50 and Contact Energy shed 8c to $5.75.

Market leader Telecom eased 2c to $2.59 and The Warehouse also slipped 2c to $3.72.

Two resource stocks were weaker in early trading, NZOG dropping 7c to $1.51 and Pike River Coal 4c to $1.11.

Sky TV dropped 5c to $5.30 and Fisher & Paykel Health lost 3c to $2.85.

Falls among other leading stocks were smaller in early trading and three posted gains: Pumpkin Patch 4c to $1.28, Rakon 2c to $1.57 and NZ Farming Systems 1c to 47c.

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On Wall Street, Reuters reported that stocks suffered their worst one-day loss in two months, dropping the S&P 500 back into negative territory for the year in a broad-based sell-off, as investors reconsidered the health of the economy.

Shares of economically sensitive sectors such as financials, energy and materials led the S&P 500's decline.

Analysts said investors were keen to sell shares that led the market up in its rally since early March.

Underscoring worries about the economy's outlook, the World Bank said prospects for the global economy remain "unusually uncertain" as it cut 2009 growth forecasts for most economies.

The Dow Jones industrial average dropped 200.72 points, or 2.35 per cent, to end at 8339.01. The Standard & Poor's 500 Index was down 28.19 points, or 3.06 per cent, at 893.04. The Nasdaq Composite Index was down 61.28 points, or 3.35 per cent, at 1766.19.

- NZPA