NZ Shares: Telecom, Contact lead market down

The New Zealand sharemarket was down in early trading with falls in leading stocks Contact Energy and Telecom.

Contact Energy lost 15c, or 2.5 per cent, to $5.80. Earlier it announced it was seeking to raise $300 million with the ability to accept unlimited oversubscriptions through a bond offer with an interest rate of 8 per cent a year.

Telecom fell 8c early to $2.34, but Fletcher Building was up 11c in the first few minutes of trading to $5.35.

Around 10.15am the benchmark NZX-50 index was down 10.26 points to 2512.05, having ended up 24.9 points on Friday.

The early stumble comes after United States stocks fell on Friday, with the S&P 500 marking its worst-ever start to a year after the US government said it will take a large stake in Citigroup's common shares, fanning fears it will increase its role in other major banks.

The decline closed out a grim month on Wall Street, with the Dow industrials hitting the lowest level since May 1997 as the blue-chip index fell for a sixth straight month.

Along with Fletcher Building, stocks to rise early in this country included Tourism Holdings, up 6c to 51, Restaurant Brands up 6c to 75, and Freightways up 4c to $2.99.

Stocks falling early included Trustpower down 11c to $7.15, Sanford down 4c to $5.31, and Fisher & Paykel Healthcare down 3c to $3.31.

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In the US, the Dow Jones industrial average dropped 119.15 points, or 1.7 per cent, to 7062.93 on Friday, the Standard & Poor's 500 Index fell 17.74 points, or 2.4 per cent, to 735.09, and the Nasdaq Composite Index slipped 13.63 points, or 1 per cent, to 1377.84.

Friday's close marked the lowest level for the S&P 500 since December 1996.

The S&P 500 is down 18.62 per cent since the start of the year, its worst two-month start on record.

US stocks have lost US$10 trillion ($20.4 trillion) since peaking in October 2007.

For the month, the S&P fell 11 per cent and the Nasdaq shed 6.7 per cent. The February decline for the S&P 500 was the second worst on record, after an 18.4 per cent slide in 1933 during the height of the Great Depression.

- NZPA