Image Source : Krish Capital Pty Ltd

Index Update: On 7th February 2025, the broader NZ market ended higher amidst buying in the financials sector. On the same day, S&P/NZX 50 Index witnessed a rise of 0.45% to end at 12,902.190 and S&P/NZX 20 Index increased by 0.51% to 7,739.340. Also, S&P/NZX 10 Index rose by 0.85%. Notably, S&P/NZX All Financials encountered an increase of 2.29% to end the session at 1,511.510. On the other hand, S&P/NZX All Consumer Staples declined by 1.09% to 2,756.060.  

Macro Update: The seasonally adjusted industry and household greenhouse gas (GHG) emissions in Aotearoa New Zealand declined 0.7% (136 kilotonnes) in the September 2024 quarter, as per Stats NZ. The decline in emissions this quarter came mainly from manufacturing, with falls in emissions recorded in most other industries. Over this quarter, industry emissions (excluding households) fell by 1.2% (204 kilotonnes). By comparison, GDP decreased 1.0% in the same period. 

Top Market Movers: Among top gainers, ikeGPS Group Limited (NZX: IKE) witnessed a rise of 32.26% to $0.82 per share. On the other hand, Black Pearl Group Limited (NZX: BPG) fell by 10.11%.  

Commodity Update: The Japanese yen surged to a nine-week high as traders bet on potential interest rate hikes in Japan this year. Meanwhile, major currencies, including the U.S. dollar, remained steady ahead of the release of U.S. monthly payroll data. After a week of market volatility driven by U.S. tariff threats, the focus shifted to the jobs report, with investors also monitoring geopolitical developments and President Trump's policy moves. In commodities, gold rose 0.47% to $2,890.30, silver climbed 0.62% to $32.93, and copper gained 1.10% to $9,389.20. Brent oil futures stayed flat at $74.27 amid ongoing supply glut concerns. 

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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. Despite the ongoing correction, the index continues to establish higher highs and higher lows, confirming the prevailing uptrend. Meanwhile, the 14-day Relative Strength Index (RSI) is trading near its midpoint, reflecting neutral market sentiment in the short-term.  

Our Stance: It could be said that the buying in the financial sector supported the broader NZ market. As of now, the broader market sentiments are being dominated by uncertain tariff news from Donald Trump. Generally, in these uncertain times, the risky assets tend to get adversely impacted. Moving forward, the decision about the rate cuts is expected to be dependent on the health of the broader US economy and labor market.  

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