14 Jul 2008

NZX down 1%

11:50 am on 14 July 2008

The New Zealand stock exchange has fallen 1% in early trading on Monday, following concerns about the housing market in the United States.

By 10.55am on Monday, the NZX 50 index had declined 34 points to 3,087.

Two-thirds of the $36 million of trading was in New Zealand's largest listed company, Telecom.

While the drop could be a minor reaction to the situation in the United States, a director at broking firm Hamilton Hinden Greene, Adrian Vance says it also reflects the general market outlook in New Zealand.

The NZX 50 index closed at 3121 on Friday. The Australian 200 index was up 34 points, to 4972.

US stocks fell more than 1% on Friday, driven by fears about the stability of two of its biggest home lenders, Freddie Mac and Fannie Mae, and higher oil prices.

Banking regulators have also taken control of a major mortgage lender, IndyMac. It was the third-largest bank failure in American history.

The Dow Jones industrial average fell 128.48 points, or 1.14%, to 11,100.54 on Friday. Standard & Poor's 500 Index slid 13.90 points, or 1.11%, to 1,239.49.

The Nasdaq Composite Index dropped 18.77 points, or 0.83%, to 2,239.08.