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The New Zealand stock market has continued its downward trend this afternoon, following the lead of the US market overnight.
The NZX-50 index opened at 3232.64 after during the week the NZX-50 index worked its way back up from Tuesday's US bailout rejection and consequent index slump.
The NZX-50 is now down 2.75 per cent, falling 86 points to 3146.
Wall Street stocks tumbled with investors nervous about the global banking crisis as a crucial vote edged closer in the US House of Representatives on a massive financial rescue package.
The Dow Jones Industrial Average sank 359.69 points (3.32 per cent) to 10,471.38 at the closing bell.
The tech-heavy Nasdaq plunged 89.94 points (4.35 per cent) to 1,979.46 and the Standard & Poor's 500 slid 47.02 points (4.05 per cent) to a preliminary close of 1,114.04.
The market remained skittish about the widening global banking crisis even after the Senate approved a US$700 billion (A$888 billion) financial rescue package with some additional tax breaks and additions and sent it back to the House of Representatives, which rejected a similar measure Monday.
Aaron Smith at Economy.com said the apparent movement on the legislation failed to help credit markets, with banks still refusing to lend cash to other banks except at unusually high rates
"Financial stress is threatening corporate funding channels and damaging the economic outlook," Smith said.
"The rates that banks charge each other increased for a fourth consecutive day, an indication that they have not started to lend after learning that the Senate passed the (rescue) bill."
NZPA/AP
