New Zealand shares fell, led lower by Air New Zealand and Xero, while Heartland Bank hit a record high.
The S&P/NZX50 Index dropped 46.66 points, or 0.6 percent, to 7,974.43. Within the index, 27 stocks fell, 17 rose and six were unchanged. Turnover was $122 million.
Air New Zealand led the index lower, dropping 4.2 percent to $3.18. The stock has gained 51 percent this year, peaking at $3.60 at the beginning of September, but has dropped back in the past two months.
"There are concerns about the currency and oil prices are starting to weigh on them a little bit," said James Smalley, senior advisor at Hamilton Hindin Greene. "A few investors who bought in a year ago may be thinking the real sweet spot is over, so it's time to take some money off the table."
Xero dropped 3.9 percent to $32.10. The stock was the worst performer on the index yesterday after it announced it will de-list from the NZX in favour of the ASX, and has shed 7.2 percent since then.
"There might well be people just re-weighting their portfolios, obviously their de-listing is still a wee way away in February but index tracker funds can't hold the stock any more," Smalley said.
A2 Milk dropped 2.1 percent to $7.41. The stock has shed 12 percent in the past week and is down 15 percent from the record $8.75 it reached on Oct. 30. It has gained 255 percent this year, making it the best performer on the index.
"There has been a reasonably sustained bout of profit taking after one of the more meteoric rises we've seen in recent years, it's not exactly unexpected," Smalley said. "Maybe the real rush to pick up the stock has abated now the momentum has slowed - a lot of large funds do buy and sell based on momentum. Investors are waiting to see if the earnings justify the price, there's still a lot of good news priced in."
Heartland Bank was the best performer, up 1 percent to $1.97, an all-time record for the stock which has gained 30 percent this year.
"It has been a quiet achiever over the last two to three years," Smalley said. "Investors who participated quite early at 50-odd cents will have done exceptionally well, particularly in contrast to the major banks - it has blown them out of the water."
Westpac Banking Corp gained 0.8 percent o $36.91 and Metlifecare rose 0.7 percent to $5.66.
Infratil gained 0.6 percent to $3.215. It lifted first-half profit 16 percent as the infrastructure investor's earnings were buoyed by a strong result from electricity generator and retailer Trustpower.
Outside the benchmark index, Vista Group International was unchanged at $5.35. It plans to double its shares on issue via a two-for-one split to increase market liquidity.
Bethunes Investments rose 5.6 percent to 1.9 cents. It narrowed its first-half loss after benefitting from a break fee when Westgate Power Centre-subsidiary NZ Retail Property Group terminated a proposed reverse listing transaction.
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