Buying in Financials Sector Supports NZ Market

Image Source : Krish Capital Pty Ltd

Index Update: On 16th April 2025, the broader NZ market ended the trading session higher amidst buying in the financials sector. On the same day, S&P/NZX 50 Index witnessed a rise of 0.47% to end the session at 12,067.920 and S&P/NZX 20 Index rose by 0.42% to 7,173.240. Also, S&P/NZX 10 Index increased by 0.67% to 11,944.470. Notably, significant buying was witnessed in the financials sector and S&P/NZX All Financials rose by 3.53% to 1,383.870.  

Macro Update: As per FEU dated 4th April, NZ’s domestic sector has been gradually recovering. Before the tariff announcements, the businesses were confident regarding the pickup in activity while current activity gradually improved. Notably, the NZ businesses are reporting that they are moving ahead with caution and are expecting business conditions to improve in 2026. Also, NZ firms with a robust balance sheet remain committed to the long-term investment plans. 

Top Market Movers: Among top gainers, Heartland Group Holdings Limited (NZX: HGH) witnessed a rise of 7.14% to $0.75 per share. On the other hand, NZME Limited (NZX: NZM) encountered a decline of 4.67% to $1.02 per share. 

Commodity Update: The dollar saw a slight rebound Wednesday as investors paused after weeks of heavy selling, awaiting updates on U.S.-China trade talks. Markets were steady ahead of China’s Q1 GDP and U.S. Fed Chair Powell’s speech. Gold climbed 1.52% to $3,289.40, silver rose 0.33%, and copper slipped 0.24% to $9,138.20. Brent crude edged up 0.10% to $64.72 amid ongoing uncertainty over U.S. trade policy and its impact on global growth.  

Source: Trading View, Analysis: Kalkine Group   

Following a break below the upward trendline that had held since November 2024 and showing signs of weakness, the S&P/NZX 50 index has continued to fall beneath a key support level — the neckline of a Head & Shoulders formation — suggesting the potential for further downside. This bearish momentum may push the index toward a major support zone around 11,500 points. At present, the index is rebounding near this strong support area and showing early signs of stabilization, with a possible bullish divergence emerging on the 14-day Relative Strength Index (RSI) in its oversold territory. This could signal a possible recovery in case the index manages to surpass its previous peak at 12,400 points.  

Our Stance: It could be said that the buying in the financials sector somewhat supported the broader NZ market on 16th April 2025. Moving forward, the global market uncertainties are likely to define the movements in NZ market. However, in the FEU dated 4th April, it was highlighted that a robust financial position can act as a shield against the short-term variability, enabling businesses to take opportunities when identified. On 29th April, Stats NZ would be reporting the business count indicators (March 2025).