NZ Shares: Market down after US, Euro stocks fall

New Zealand shares have followed the lead of European and United States stocks which fell ahead of what is expected to be a dismal corporate earnings season.

Fletcher Building dropped 15c early to $6.00, adding to its 5c loss yesterday, while Contact Energy dropped 5c to $5.90.

Telecom was down 6c to $2.43 early after helping restrain yesterday's overall market fall when it put on 4c.

Around 10.15am the benchmark NZX-50 index was down 18.97 points to 2593.5, on top of yesterday's fall of nearly 21 points.

Restaurant Brands gained 1c early to 86, after reporting its annual net profit, excluding non-trading items, rose by 13 per cent to $11.7 million.

Freightways was untraded early on $2.78, with a trading halt on the company lifted after it completed a $45 million underwritten placement yesterday.

Stocks losing ground early included Mainfreight down 9c to $3.95, Nuplex down 3c to 28, and Sky City down 3c to $2.72.

Fisher & Paykel Healthcare made a solid early gain, rising 8c to $2.90.

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In the US, stocks were hammered by fears that as the earnings season kicked off companies will show they struggled in the first quarter as the recession dragged on.

After the worst fourth-quarter earnings season on record, investors were expecting another round of poor profits.

"The key is going be what companies say about the future," said Craig Hester, chief executive of Hester Capital Management in Austin, Texas. "I don't think it's going to be any surprise to people that the first-quarter earnings are going to be lousy."

The Dow Jones industrial average fell 2.3 per cent to 7789.56, the Standard & Poor's 500 Index lost 2.4 per cent to 815.55, and the Nasdaq Composite Index gave up 2.8 per cent to 1561.61.

- NZPA