New Zealand shares fell, led by Steel - Tube Holdings, New Zealand Oil and Gas and Fletcher Building, joining a global sell off in equities in the face of weaker crude oil and euro zone economic weakness. Defensive, income-paying stocks, including MightyRiverPower, Precinct Properties New Zealand and Spark New Zealand gained.

The NZX 50 Index fell 41.223 points, or 0.7 percent, to 5561.378. Within the index, 32 stocks fell, seven rose and 11 were unchanged. Turnover was $85 million.

Overnight Wall Street dropped as oil prices tumbled to a five-and-a-half year low amid oversupply while renewed talk about a Greece exiting the Eurozone and weak German economic data spooked investors that global economic growth was faltering. Markets across Asia fell, with Japan's Nikkei 225 Index sliding 2.4 percent in afternoon trading, Australia's S-P/ASX 200 Index dropped 1.9 percent and Hong Kong's Hang Seng Index declined 1.4 percent.

Steel - Tube led the benchmark index's decline in a broad-based sell off, dropping 3.1 percent to $2.81. NZ Oil and Gas, the exploration company, fell 3.1 percent to 63 cents. Fletcher, the construction and building supplies business, fell 3 percent to $8.22.

"Oil has historically fallen in price because of a demand reduction - when you have a slow economy people obviously consume less oil," Shane Solly, director at Harbour Asset Management said. "This time it is a little different you've got a lot of supply coming through, so it's a supply shock rather than a demand shock.

"There have been concerns about economic activity slowing again, and another drop in activity and that has been very much pushing things along in the last 48 hours," Solly said. "There have been weaker economic data points coming, particularly out of Europe."

Sky Network Television, the country's dominant pay-TV provider, dropped 3 percent to $5.81. Metlifecare, the retirement village operator, declined 2.8 percent to $4.57. Ebos Group, the healthcare and animal care manufacturer, fell 2.6 percent to $9.60. Pacific Edge, the biotech firm, slipped 2.3 percent to 85 cents.

Income paying stocks were among the day's few gainers, with energy company MRP the best performer on the day up 2.7 percent to $3.095. Precinct Properties rose 2.1 percent to $1.235. Spark, formerly Telecom Corp, gained 1.8 percent to $3.14. Argosy Property advanced 1.4 percent to $1.13. Kiwi Property Group climbed 1.2 percent to $1.26 while Goodman Property edged up 0.4 percent to $1.155.

"Our market has held up remarkably well - we're a relatively high yielding defensive sort of a market," Solly said. "Some of the more defensive, high yielding stocks trading up - like MightyRiver, the property stocks, and Spark."

Freightways, the courier and logistics company, rose 0.2 percent to $5.81, on the prospect of falling oil prices flowing through to lower petrol costs for the company.