The New Zealand sharemarket fell more than 4% on opening after the United States House of Representatives rejected a compromise plan to bailout the financial industry.
The opening fall in New Zealand has set the tone for the day, with 137 points being wiped off the benchmark NZX-50 index in less than 10 minutes.
Telecom was down 16c, or 5.8%, early to $2.62, Contact Energy was down 34c, or 4.1%, to $7.95 and Fletcher Building lost 36c, of 5.2%, to $6.55.
In the US, the Dow Jones Industrial Average index ended down 777 points, or nearly 7% in the largest one-day fall ever.
The failure of the Bill, which would have let the US Treasury buy up bad mortgage debt from struggling banks, added to serious concerns after the credit crisis claimed new victims including Wachovia Corp and a host of European banks.
Shortly after 7.30am the New Zealand dollar slipped about a third of a cent to US67.55c, having already fallen last night from a high of US68.85c.
