Image Souce: Krish Capital Pty Ltd

Index Update: On 11th November 2024, the broader NZ market ended lower amidst selling in the consumer staples sector. On the same day, S&P/NZX 50 Index witnessed a decline of 0.66% to end the session at 12,686.330 and S&P/NZX 20 Index fell by 0.82%. Also, S&P/NZX 10 Index fell by 0.68%. Also, S&P/NZX All Consumer Staples encountered a fall of 3.77%. However, S&P/NZX All Materials witnessed a rise of 4.14%.  

Macro Update: Recently, financial statements of the government of NZ (for the year ended 30 June 2024) were released. Notably, the Crown’s operating balance before gains and losses (or OBEGAL) deficit widened by around $3.4 Bn to reach $12.9 Bn. In order to bring revenue and expenses back into balance, the coalition Government (which came into office towards the middle of the 2023/24) is focused towards controlling spending and restoring fiscal discipline. 

Top Market Movers: Among top gainers, Cooks Coffee Company Limited (NZX: CCC) witnessed a rise of 11.32% to end the session at $0.295 per share and Enprise Group Limited (NZX: ENS) increased by 6.90%. On the other hand, Green Cross Health Limited (NZX: GXH) fell by 7.32%.  

Commodity Update: The dollar traded cautiously on Monday as markets prepared for U.S. inflation data and a series of Federal Reserve speeches. The yuan was under pressure after China’s latest stimulus package failed to impress. Weekend data showed China’s consumer price growth slowed to a four-month low in October, while producer prices deepened deflation. In commodities, gold fell 0.64% to $2,675.80/oz, silver dropped 0.46% to $31.30, and copper gained 0.22% to $9,661.50/ton. Crude oil declined 0.2% to $73.72 a barrel, with China's fiscal measures falling short and a Gulf of Mexico hurricane having minimal impact on U.S. production. 

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Source: Trading View, Analysis: Kalkine Group  

In July 2024, the S&P/NZX 50 index surpassed both the neckline of a Head and Shoulders pattern on the daily chart and a key resistance level marked by its 2023 high. This breakout indicates that the uptrend, which started in November 2023, is likely to persist and could push the index toward its historical peak from 2021. While currently experiencing a minor pullback, the index continues to form higher highs and higher lows, reinforcing the ongoing uptrend. Furthermore, the 14-day Relative Strength Index (RSI) is hovering around its midpoint, indicating a neutral market sentiment in the short-term. 

Our Stance: It could be said that the broader NZ market was impacted by the selling in consumer staples sector. Moving forward, the global and NZ markets are expected to be impacted by the macro-economic datapoints. Talking about this week, the markets might get influenced by the October consumer price index data, which would be released on 13th November. Moreover, data about initial jobless claims will be released on 14th November.  

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