New Zealand quake kills at least 65

New Zealand rescue teams worked under search lights early Wednesday to find scores of people trapped under collapsed buildings after an earthquake struck the country's second-biggest city of Christchurch, killing at least 65 people.

About 120 survivors have already been rescued from the rubble, but the death toll is expected to rise following the second strong quake to hit the city of almost 400,000 people in five months.

We may well be witnessing New Zealand's darkest day...The death toll I have at the moment is 65 and that may rise, said New Zealand Prime Minister John Key, who had flown to his home town of Christchurch, where he still has family.

Tuesday's 6.3 magnitude quake struck at lunchtime, when streets and shops thronged with people and offices were still occupied. It was New Zealand's most deadly natural disaster for 80 years.

Rescuers, working under lights in rain, focussed on two collapsed buildings: a financial-services office block whose four stories pancaked on top of each other, and a TV building which also housed an English-language school.

About a dozen Japanese students at the school were believed to be missing, an official in Japan told Reuters, while public broadcaster NHK said several other students from another group in the building were also unaccounted for.

Trapped survivors could be heard shouting out to rescuers from the TV building. Local media say as many as a dozen or more people could still be inside. Relatives of those feared trapped kept a vigil outside the building as rain began to fall.

All of our energy tonight is really focussed on the need to rescue people, said Christchurch Mayor Bob Parker, estimating 120 people had been pulled out of rubble or rescued so far.

A woman freed from a collapsed building said she had waited for six hours for rescuers to reach her after the quake, which was followed by at least 20 aftershocks.

I thought the best place was under the desk but the ceiling collapsed on top, I can't move and I'm just terrified, office worker Anne Voss told TV3 news by mobile phone.

Christchurch Mayor Parker described the city, a historic tourist town popular with overseas students, as a war zone. He told local radio that up to 200 could be trapped in buildings but later revised that estimate down to around 100 or so.

It was the country's worst natural disaster since a 1931 quake in the North Island city of Napier which killed 256. Christchurch Hospital saw an influx of injured residents.

They are largely crushes and cuts types of injuries and chest pain as well, said David Meates, head of the Canterbury Health Board. Some of the more seriously injured could be evacuated to other cities, he added.

HISTORIC CATHEDRAL IN RUINS

On the way into the city, a Reuters correspondent saw buckled roads, toppled buildings and big pools of water. Police and the army were patrolling the streets.

Christchurch has been described as a little piece of England.

It has an iconic cathedral, now largely destroyed, and a river called the Avon. It had many historic stone buildings, and is popular with English-language students and also with tourists as a springboard for tours of the scenic South Island.

Emergency shelters had also been set up in local schools and at a race course. Helicopters dumped water to try to douse a fire in one tall office building, while a crane was used to help workers trapped in another office block.

I was in the square right outside the cathedral -- the whole front has fallen down and there were people running from there. There were people inside as well, said John Gurr, a camera technician who was in the city centre when the quake hit.

Aerial TV footage of surroundings suburbs showed once-elegant homes in ruins and roads cut off by huge boulders.

There have been offers of help from the United States and Japan, while neighbouring Australia is sending 148 search and rescue specialists, including sniffer dogs. Britain's Queen Elizabeth offered her sympathy and said in a statement she was utterly shocked by news of the quake.

STREETS TURN INTO QUICKSAND

Christchurch is built on silt, sand and gravel, with a water table beneath. In a quake, the water rises, mixing with the sand and turning the ground into a swamp, swallowing up roads and cars.

TV footage showed sections of road that had collapsed into a milky, sand-coloured lake beneath the surface. One witness described the footpaths as like walking on sand.

Unlike last year's even stronger tremor, which struck early in the morning when streets were virtually empty, people were walking or driving along streets when the shallow tremor struck, sending awnings and the entire faces of buildings crashing down.

Police said debris had rained down on two buses, crushing them, but there was no word on any casualties.

Fears that the quake could dent confidence in the country's already fragile economy knocked the New Zealand dollar down by about 1.8 percent from late U.S. levels to $0.75.

Westpac Bank raised the possibility that the central bank could cut interest rates over the next few weeks in a bid to shore up the economy, while other banks pushed out their expectations for the timing of the next rate increase.

ANZ now expects the central bank to keep rates on hold until the first quarter of 2012.

Shares in Australian banks and insurers, which typically have large operations in New Zealand, fell after the quake.

The quake hit at 12:51 pm (2351 GMT Monday) at a depth of only 4 km (2.5 miles), according to the U.S. Geological Survey.

The tremor was centred about 10 km (six miles) southwest of Christchurch, which had suffered widespread damage during last September's 7.1 magnitude quake but no deaths.

New Zealand sits between the Pacific and Indo-Australian tectonic plates and records on average more than 14,000 earthquakes a year, of which about 20 would normally top magnitude 5.0.