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MARKET CLOSE: NZ stocks fall, led by Kathmandu as kiwi climbs; NZOG drops

New Zealand shares fell, led by Kathmandu, on concern a stronger kiwi dollar reduces the value of the retailer's offshore sales. New Zealand Oil and Gas fell as the price of crude oil extended its slide.

The NZX 50 Index fell 21.508 points, or 0.4 percent, to 5502.067. Within the index, 30 stocks fell, 16 rose and four were unchanged. Turnover was $190 million.

The New Zealand dollar jumped against the greenback and gained versus the Australian dollar after Reserve Bank Governor Graeme Wheeler kept signaled future interest rate hikes, even while lowering his projections for the 90-day bank bill rate and economic growth.

Kathmandu, the outdoor goods retailer which earns most of its income across the Tasman, dropped 6.6 percent to $2.85. Trade Me Group, the online retailer, slipped 4.1 percent to $3.49.

"One of the key things today was the strength of the New Zealand exchange rate, including the Kiwi-Aussie cross rate," said Matthew Goodson, managing director at Salt Funds Management. "That's part of it, part of it has also been the whole Australasian retail space has been under considerable pressure. New Zealand is somewhat better than Australia in an overall sense, but obviously it's going to vary by company."

Overnight, markets on Wall Street and in Europe fell with oil prices after the Organisation of the Petroleum Exporting Countries downgraded its forecast for 2015 global demand to the lowest level in 12 years, while Saudi Arabia's oil minister maintained the nation's resistance to cutting output. Asian markets followed suit, with Hong Kong's Hang Seng Index dropping 1.1 percent, Japan's Nikkei 225 Index declining 1.2 percent and Australia's S&P/ASX 200 Index down 0.6 percent in afternoon trading.

NZ Oil & Gas, the country's only petrol producer, declined 1.5 percent to 64 cents. OceanaGold, the triple-listed gold and copper miner, fell 3.3 percent to $2.35.

"The bigger lead in the market was the extreme weakness in the world overnight," Goodson said. "Oil prices continue their plunge, which at one level is very good news for the world but at another level will certainly lead to fears of financial instability in some countries. Also, Greek fears are re-emerging in Europe, with the calling of a snap election there clearly weighing on European markets."

NZX was unchanged at $1.16 after it said it will establish a new board committee to oversee the way New Zealand's financial markets operator manages conflicts. The stock market operator and regulator has added a third string to its bow adding fund manager after purchasing SuperLife, in a bid to bolster its exchange traded funds.

Xero, the cloud-based accounting software firm, fell 1.3 percent to $15.99 after it said it has more than 400,000 customers globally and is "back on track" in its key US market.

Spark New Zealand, formerly Telecom Corp, rose 1 percent to $3.17.

Meridian Energy was the best performer on the day, gaining 2.9 percent to $1.80.

On the New Zealand Alternative Index, GeoOp rose 6 percent to 53 cents after the small business app developer, widened its first-half loss to $2.7 million in the six months ended Sept. 30, from a loss of $1.6 million, as it spent more on product development and sales to chase global growth.