The New Zealand sharemarket has fallen to a three year low, following sharp drops in other markets throughout the world.
The NZX-50 was down 2.7 percent at 2968 just before noon, its lowest point since 2005.
Buyers made a cautious entry into the New Zealand sharemarket this morning as top stock prices slid one minute after the NZX-50 opened.
The benchmark index followed the lead of United States and United Kingdom sharemarkets by opening 81 points down, but 30min later the index had settled as buyers started picking up blue chip stocks like Fletcher Building, Contact and GPG.
Forsyth Barr broker Peter Young said the opening fall was expected.
"We are tracking Wall Street. It's all down. The interesting thing will be when Australian markets open. I expect them to be down 4% or 5% and we will see where we go from there.
"We had two down days I would not be surprised to see a bit of a bounce at the end of trading as people start to realise there are some bargains out there.''
US stocks ended sharply lower, with the Dow finishing below 10,000 for the first time in four years, on concerns that fallout from the escalating credit crisis will drag the global economy into recession and cripple profits.
Based on the latest data, the Dow Jones industrial average fell 369.88 points, or 3.58%, to end unofficially at 9955.50.
The Standard & Poor's 500 Index slid 42.38 points, or 3.86%, to close unofficially at 1056.85. The Nasdaq Composite Index shed 84.43 points, or 4.34%, to finish unofficially at 1,862.96.
It was the S&P 500's lowest close since December 2003.
Telecom was down 9c to 270, Fletcher Building 23c to $6.27 and Contact Energy 16c to $7.24.
Most of the top-50 were down. Among the worst hit were Sky City down 15c to $3.18, Steel & Tube 11c to $3.60, Fisher & Paykel Appliances 8c to $1.56, Freightways 5c to $3.12, Infratil 7c to $1.93, NZ Oil and Gas 8c to $1.20, Pike River Coal 7c to $1.55 and Rakon 13c to $2.20.
The only top-50 stock to rise was Michael Hill, up 2c to 74c following a 5c fall yesterday.
The pan-European FTSEurofirst 300 index fell 7.4 percent to a provisional close of 1008.86 points.
In Japan, the Nikkei shed 465.05 points to 10,473.09, its lowest close since February 2004. It earlier hit an intraday low of 10,374.38 and fell 5 percent.
Australian shares dropped 3.3 percent on Monday to a near three-year low.
Australia's benchmark S&P/ASX 200 index ended down 155 points at 4540.4, its lowest close since November 2005.
