NZ sharemarket holds losses as Australian shares slide
[UPDATE] Attention turns to the Australian equities market, which was down 2.2% shortly after opening.
The New Zealand sharemarket held its morning losses as attention turned to the Australian equities market, which was down 2.2% shortly after opening.
At 12.30pm local time the benchmark S&P/ASX 200 was 89 points lower (down 2.2%) at 4020 following the US credit rating downgrade over the weekend.
The All Ordinaries index fell 93.6 points, or 2.25%, to 4,076.1.
The NZX-50 recovered slightly to be down 88 points, or 2.7%, at 3189, having plunged as much as 3.3% on opening.
The drop followed a 3% fall on Friday in the NZX-50’s worst day of trading in more than two years.
The slide in equities was prompted by ratings agency Standard & Poor's decision to downgrade the US Government's credit rating from AAA to AA+.
Adding to the uncertainty is growing anxiety about the ability of several European economies, including Italy, to repay their huge debts and meet interest payments.
The New Zealand sharemarket fell sharply this morning amid a global selloff in equities on fears of a worsening European debt crisis and a slowdown in the US economy.
James Lee, head of institutional equities at First NZ Capital, said the local investors were concerned with how other markets behaved. Volume of shares traded had been relatively light this morning, suggesting retail investors were the main sellers.
“It’s hands on heads now waiting to see how the market pans out,” Mr Lee said.
Mr Lee said the next step was to see what sort of volume goes through the market.
“I think the New Zealand market will have done most of its damage up until now in terms of pricing – it's whether or not we see any improvement in terms of liquidity in the market."
At 12.30pm top stock Fletcher Building was down 18c, or 2.3%, at $7.53, and Telecom was down 7c (2.7%) at $2.50.
Duel listed banking shares ANZ and Westpac were down 4.1% and 3.1% respectively.
Duncan Bridgeman
Mon, 08 Aug 2011
Mon, 08 Aug 2011
© All content copyright NBR. Do not reproduce in any form without permission, even if you have a paid subscription.
NZ sharemarket holds losses as Australian shares slide
16243