Beginning readers need lots of practice reading it takes time, practice, time, and more practice! Work with your daughter's teacher to learn exactly at what level she is reading. Then, go to the library and load up on books written at that level and below. Provide her with time each day to read and reread those below reading level books. You'll want to build up her confidence and fluency with those books. Then, support her reading by reading her the books at her instructional level. Prompt her to sound out words that can be sounded out (and just tell her the ones that can't or are too tricky). Praise her efforts and reread each book multiple times over the course of a week or two. Finally, get some terrific children's literature written above her reading level. Model lots of good expression and let her hear what good, fluent reading sounds like. Check Reading Rockets' Books & Authors section for some great titles!
Do everything you can to provide a fun climate for reading. If a book is too hard, put it away. Reinforce her efforts and continue to work closely with your school and teachers. If she continues to struggle, talk with them about additional testing and some one-on-one supervised tutoring.