New Zealand shares fell, paced by MightyRiverPower, Meridian Energy and Genesis Energy, as investors booked profits on companies that have driven the NZX 50 Index to record highs. Kathmandu Holdings rose ahead of its first-half earnings on Friday.

The NZX 50 Index fell 5.99 points, or 0.1 percent, to 5905.407. Within the index, 26 stocks fell, 20 rose and four were unchanged. Turnover was unchanged at $130 million.

The benchmark index has been pushed to record levels this year, as traders seek income paying stocks, such as utility companies, telecommunications and property investors, in a globally low interest rate environment. Today investors looked to book recent gains.

The partially-privatised energy generators and retailers declined. Meridian dropped 1.2 percent to $2.105. MRP slipped 0.5 percent to $3.24. Genesis fell 0.4 percent to $2.35. Spark New Zealand, formerly Telecom Corp, eased back 0.2 percent to $3.145.

"On any historic valuation measures of price to earnings our market is very expensive but it's only when you relate that to unusually low interest rates, that it makes sense," said Matthew Goodson, managing director at Salt Funds Management. "All equity markets globally have had a huge run, and I don't think New Zealand is by itself in that respect, it is just the tailwind provided by very, very low interest rates and people searching for yield."

Kathmandu was the best performer on the bench mark index, gaining 3 percent to $1.72. The outdoor goods retailer earns most of its income from its Australian market, which has been weighed on by weak consumer sentiment and unseasonal weather, denting sales. In February it flagged a first-half loss of between $1 million and $2 million in the 26 weeks ended Jan. 25, compared with a profit of $11.4 million in the same period a year earlier and is due to report its financials this Friday.

"In general the sentiment in the Australian retail sector seems to have picked up somewhat in January and February," Goodson said. "They've updated us on their sales outcomes and I certainly wouldn't be expecting a great result, but what really matters is the following year and any comments they make on early trading."

Xero, the cloud-based accounting firm, led the benchmark index lower, dropping 2.9 percent to $24.81.

Outside the benchmark index, Moa Group was unchanged at 37 cents, after the boutique beer maker said its full-year loss will be in line with 2014's loss of $5.8 million, with its strategy to cut costs and fatten margins likely to start delivering benefits in 2016.