Image Souce: Krish Capital Pty Ltd

Index Update: On 6th December 2024, the broader NZ market ended in red amidst decline in the consumer discretionary sector. On the same day, S&P/NZX 50 Index witnessed a decline of 0.68% to end the session at 12,809.590 and S&P/NZX 20 Index fell by 0.71% to 7,699.130. Also, S&P/NZX 10 Index declined 0.95% to 12,979.440. S&P/NZX All Consumer Discretionary encountered a decline of 1.68% to close the session at 759.340. However, S&P/NZX All Materials increased by 1.90%.  

Macro Update: In the year ended December 2022, total consumption-based emissions were 57,254 kilotonnes, down 4.4% from 2021 and 7.7% (4,777 kilotonnes) lower than pre-COVID-19 levels in 2019, as per Stats NZ. The household consumption was the largest contributor, accounting for 67% (38,592 kilotonnes) of total emissions. The carbon footprint of households decreased the most, by 1,401 kilotonnes (or 3.5%), driven by lower emissions embodied in housing and household utilities (down 16%, 878 kilotonnes).  

Top Market Movers: Among top gainers, Foley Wines Limited (NZX: FWL) witnessed a rise of 7.69% to end the session at $0.70 per share. On the other hand, Rua Bioscience Limited (NZX: RUA) fell by 16.67% to $0.025 per share. 

Commodity Update: Major currencies held steady on Friday as markets reflected on a turbulent week marked by the collapse of France's government and brief martial law in South Korea. Bitcoin paused after surging above $100,000, with even sceptics anticipating that a crypto-friendly Trump administration could fuel further gains. The U.S. non-farm payrolls report for November took centre stage as investors speculated on the pace of potential Federal Reserve rate cuts. In commodities, gold slipped 0.04% to $2,647.20, silver rose 0.30% to $31.63, and copper climbed 0.23% to $9,115.50. Brent crude edged lower by 0.10% to $72.00 amid concerns over weak demand and OPEC+ supply cuts, extended through 2026. 

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. Moreover, since the break-out, the index has been forming higher highs and higher lows, reinforcing the ongoing uptrend. Furthermore, the 14-day Relative Strength Index (RSI) is trading near its midpoint, indicating neutral market sentiment in the short-term. 

 
Our Stance: It could be said that the broader NZ market was impacted by the sell-off in the consumer discretionary sector. The overall market sentiment remains cautious as global factors and commodity price fluctuations are adding complexity to the outlook. Market participants believe that stocks have demonstrated a robust momentum because of investor optimism that Trump might opt for growth-oriented policies. However, global economic uncertainties might weigh over the broader growth momentum.   

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