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New Zealand shares slip to year low on international volatility

New Zealand shares slip to year low on international volatility

The New Zealand stock market slipped Wednesday to its lowest close for the year as the U.S. subprime mortgage sector and broader concerns about the U.S. economy continued to weigh on global markets.
The benchmark NZX-50 index dipped below 4,000 before closing down 61.2 points, or 1.5 percent, at 4004.46 _ its lowest closing level since December 2006.
"It's not a particularly pretty day for the market. World markets are all just following each other at the moment and they're quite skittish due to the secondary mortgage debt issues in the U.S.," said UBS equities director Paul Nicolson.
He expects the local bourse to remain volatile until credit crunch concerns in the U.S. are calmed.
The drop came after the Dow Jones industrial average tumbled 207.61 points, or 1.57 percent, to 13,028.92, its lowest close since April 24.
Brokers said the local market was hit as domestic investors took profits and as foreigners unwind their exposure to the New Zealand dollar, which has fallen more than 10 percent from its peak of US$0.8110 hit July 24.
At its local close the New Zealand dollar was buying US$0.7173, well below Tuesday's local close of US$0.7313.
Among blue chips, Auckland International Airport fell 1.3 percent to NZ$3.06, Contact Energy was down 1.4 percent to NZ$8.90 and casino operator Sky City lost 2.2 percent to NZ$4.40.
Key retail stocks also fell, with discount retailer The Warehouse dropping 4.9 percent to NZ$5.83, clothing retailer Hallenstein Glasson losing 2.2 percent to NZ$4.45, Hellaby Holdings falling 2.5 percent to NZ$3.10 and Briscoe Group down 1.9 percent to NZ$1.52.
Home appliance manufacturer Fisher & Paykel Appliances closed down 1.7 percent to NZ$3.51, paring earlier losses on news that it plans to relocate more manufacturing to Thailand.
The move of its Auckland electronics factory follows the relocation of washing machine production to the same location.


Updated : 2021-10-24 19:44 GMT+08:00