Buying in Materials Sector Helps NZ Market

Source: Krish Capital Pty Ltd

Index Update: On 8^th September 2025, the broader NZ market closed in green amidst buying in the materials sector. On the same day, S&P/NZX 50 Index witnessed a rise of 0.44% to end at 13,281.140 and S&P/NZX 20 Index increased by 0.54% to 7,717.020. Also, S&P/NZX 10 Index witnessed an increase of  0.50% to 12,842.820. Notably, significant buying was witnessed in the materials sector and S&P/NZX All Materials rose by 2.22%. 

Macro Update: As per FEU dated 28 August 2025, the monthly merchandise trade deficit narrowed to $278 Mn in July from $511 Mn in June. The primary exports are a strong point for the broader NZ economy as domestic demand takes time. The annual trade deficit narrowed to $3.9 Bn in July, down from the peak of $17.1 Bn in 2023.

Top Market Movers: Among top gainers, Santana Minerals Limited (NZX: SMI) witnessed a rise of

5.81% to end at $0.82 per share. On the other hand, WasteCo Group Limited (NZX: WCO) declined by 5.26% to $0.018 per share.

Commodity Update: The dollar wavered on Monday after weak U.S. labour data reinforced expectations of a rate cut, while the yen slid on political uncertainty following Prime Minister Shigeru Ishiba’s resignation. Commodities showed mixed trends: gold slipped 0.51% to $3,634.45, silver fell 0.49% to $41.34, and copper gained 0.23% to $9,910.35. Brent crude rose 0.60% to $65.90, supported by slower OPEC+ production hikes and geopolitical tensions surrounding the Russia-Ukraine conflict. 

Source: Trading View, Analysis: Kalkine Group

After beginning a short-term rally in April 2025, the S&P/NZX 50 index has recently revisited its 2024 peak at 13,270. Additionally, the index continues to register higher highs and higher lows, signaling that the uptrend is still intact. A decisive break above this resistance would strengthen bullish momentum and potentially pave the way for a test of the all-time high at 13,636. On the downside, immediate support lies at 12,750, with a breach of this level serving as an early warning signal. Meanwhile, the 14-day Relative Strength Index (RSI) is heading north from its midpoint, reflecting a positive market sentiment.

Our Stance: It could be said that the strong buying in the materials sector somewhat supported the broader NZ market on 8^th September 2025. RBNZ stated that a broad range of indicators demonstrate that significant spare capacity in the NZ economy is still there. The Committee also discussed the slow growth in the productive capacity of NZ’s economy. Notably, potential output growth has slowed due to the subdued investment, low productivity growth, and historically low population growth via net immigration. Moving forward, the broader NZ economy is expected to be influenced by the global factors and trade policies. Therefore, the investors are required to be cautious.