NZ Market Closes on a Flat Note

Index Update: On 15th December, the broader NZ market ended on a flat note, with S&P/NZX 50 Index witnessing a marginal rise of 0.01% to end at 13,408.140 and S&P/NZX 20 Index encountering an increase of 0.03% to close at 7,626.060. Also, S&P/NZX 10 Index witnessed a rise of 0.35% to 12,786.110. Notably, significant decline was witnessed in the energy sector and S&P/NZX All Energy fell by 2.48% to close at 2,530.100.     

Macro Update: On December 15, RBNZ Governor Dr Anna Breman stated that there are signs that growth is recovering after having stalled in the middle of the year. While the labour market remains weak, it is expected to recover as demand in the economy strengthens. Notably, if the economic conditions evolve as anticipated, the OCR is expected to remain at its current level of 2.25% for some time, added Dr Breman.   

Market Movers: Among top gainers, Manuka Resources Limited (NZX: MKR) witnessed a rise of 10.81% to end at $0.082 per share. Black Pearl Group Limited (NZX: BPG) declined by 5.29%.   

Commodity Update: The U.S. dollar remained under pressure on Monday, while the euro and sterling traded steady ahead of key central bank meetings this week. Focus stayed on interest rate outlooks as the new year approaches. Gold rose 0.72% to USD 4,358.20, silver gained 1.34% to USD 62.83, and copper increased 0.70% to USD 11,653.20. Brent crude added 0.50% to USD 61.44, though oversupply and weak demand concerns persisted. 

Source: Trading View, Analysis: Kalkine Group  

The S&P/NZX 50 Index printed a Doji candlestick, edging up marginally by 1.25 points, or 0.01%, to close at 13,408.15. This price action indicates ongoing consolidation, with the index continuing to oscillate between its recent record high and a major support zone near the 2024 peak. From a technical perspective, the short-term structure remains constructive, supported by a sustained sequence of higher highs and higher lows, and by the index holding comfortably above its key support area. As long as this critical support is preserved, the broader uptrend that commenced in October 2023 remains valid. Initial support is located around 13,270, and maintaining this level is important to keep bullish momentum intact and allow for another test of the all-time high. Conversely, a decisive break below 13,270 would signal a deeper corrective phase, with scope for a pullback toward the 13,000 region before the primary uptrend is likely to reassert itself.  

Our Stance: Moving forward, the broader US markets are expected to be impacted by the upcoming economic releases. Data about the US retail sales will be released on December 16, and information about initial jobless claims is expected on December 18. Coming to the NZ, Dr Breman stated that financial market conditions have tightened since the decision announced in November. It is expected that annual headline consumers price index inflation would fall towards the 2% target mid-point by the middle of next year, added Dr Breman.