Buying in IT Sector Supports Broader NZ Market

Image Source : Krish Capital Pty Ltd

Index Update: On 28th February 2025, the broader NZ market closed the session higher amidst buying in the IT sector. On the same day, S&P/NZX 50 Index witnessed a rise of 0.48% to end the session at 12,601.420 and S&P/NZX 20 Index increased by 0.63% to 7,556.150. Also, S&P/NZX 10 Index encountered an increase of 0.68% to end at 12,483.120. S&P/NZX All Information Technology rose by 3.09% to close at 2,987.880.  

Macro Update: NZ’s merchandise trade continued to rebalance in early-2025, as per Fortnightly Economic Update. The release also stated that the annual goods trade deficit narrowed to $7.2 Bn in January, from $7.8 Bn in December. Notably, export values, which were up 11% in the month, were helped by robust lifts in dairy and forestry exports. December’s seasonally adjusted visitor arrivals rose marginally to 291,000 in the month, sitting at 87% of 2019 levels.  

Top Market Movers: Among top gainers, Pacific Edge Limited (NZX: PEB) witnessed a rise of 115.87% to end at $0.136 per share. On the other hand, Move Logistics Group Ltd (NZX: MOV) declined by 10.42% to $0.215 per share. 

Commodity Update: The U.S. dollar gained safe-haven support on Friday amid looming tariffs from President Donald Trump. However, it was still on track for a monthly loss as investors balanced these threats with concerns over a weakening U.S. economy. In commodity markets, gold slipped 0.38% to $2,884.80, silver fell 2.18% to $31.56, and copper dropped 0.27% to $9,389.50. Brent crude oil also declined 0.40% to $73.26, heading for its first monthly loss since November. The drop in oil prices reflected concerns about global economic growth and fuel demand amid U.S. tariff threats and signs of a slowing economy. 

Source: Trading View, Analysis: Kalkine Group   

In July 2024, the S&P/NZX 50 index broke above both the neckline of a Head and Shoulders pattern on the daily chart and a crucial resistance level set by its 2023 high. This breakout suggests that the uptrend, which began in November 2023, is likely to continue and may drive the index toward its 2021 historical peak. Despite the ongoing correction, the index is bouncing back above the key support level defined by the 2023 high and the pattern’s neckline, reinforcing expectations of a sustained uptrend. Additionally, the 14-day Relative Strength Index (RSI) is reversing from its oversold territory, signaling a potential rebound in the near future.  

Our Stance: It could be said that buying in the IT sector supported the broader NZ market on 28th February 2025. The fears related to the tariffs continued to impact the broader markets and the investors’ sentiments. NASDAQ Composite Index witnessed a decline of 2.78% on 27th February 2025. Amidst such uncertainties, the market players are required to be cautious with their investments in risky assets. On 3rd March, data about ISM manufacturing is expected to be released.