NZ Market Ends in Red Amidst Broad-based Decline

Image Source : Krish Capital Pty Ltd

Index Update: On 31st March 2025, the broader NZ market ended in red amidst sell-off in the real estate sector. On the same day, S&P/NZX 50 Index witnessed a fall of 0.14% to end at 12,270.000 and S&P/NZX 20 Index declined 0.22% to close at 7,262.930. Also, S&P/NZX 10 Index encountered a fall of 0.23%. Notably, S&P/NZX Real Estate Select Index witnessed a decline of 0.86% to 1,493.070. However, S&P/NZX All Consumer Discretionary increased by 0.92%.  

Macro Update: As per recent FEU, International trade provided support for the domestic economy through late last year. On the volumes side, the goods exports witnessed a rise of 1.3% while goods imports declined 1.7%, reflecting a positive 0.6 percentage point contribution to real GDP growth in the December quarter. Notably, the signs of slower US growth have been impacting the financial markets.  

Top Market Movers: Among top gainers, Rua Bioscience Limited (NZX: RUA) witnessed a rise of 7.69%. On the other hand, New Talisman Gold Mines Limited (NZX: NTL) declined by 6.38% to $0.088 per share. 

Commodity Update: The dollar fell, while gold surged above $3,100 per ounce for the first time, driven by concerns over U.S. President Donald Trump’s tariffs and geopolitical tensions, prompting a flight to safe-haven assets. Gold rose 0.83% to $3,140.80, silver gained 0.58% to $35.08, and copper dipped 0.38% to $9,766.55. Brent oil dropped 0.20% to $73.52 per barrel after Chinese media reported major reserves in the South China Sea, easing supply fears. Crude prices fell after three weeks of gains, impacted by worries over potential U.S. sanctions on Russia amid slowing global growth. 

Source: Trading View, Analysis: Kalkine Group   

After penetrating the upward trendline that had been in place since November 2024 and exhibiting signs of weakness, the S&P/NZX 50 index continues to break below a key support level marked by the neckline of a Head & Shoulders pattern, indicating the possibility of further declines. This downward pressure could drive the index toward strong support around 11,500 points before any signs of recovery emerge. While the index is currently experiencing a minor rebound, it is approaching resistance at the 21-day SMA, which could lead to a continuation of the short-term downtrend. Moreover, the 14-day Relative Strength Index (RSI) remains below its midpoint, reinforcing a bearish short-term market sentiment.  

Our Stance: It could be said that the decline in the real estate sector somewhat impacted the broader NZ market on 31st March 2025. As of now, the broader global markets are being impacted by the fears related to the trade wars as well as recession. The tariff fears have the potential to derail the growth prospects and can impact the investors’ sentiments. Apart from these measures, the global and NZ markets are expected to be impacted by macro-economic data points moving forward.