Image Souce: Krish Capital Pty Ltd

Index Update: On 20th November 2024, the broader NZ market ended in red as selling was witnessed in the materials sector. On the same day, S&P/NZX 50 Index witnessed a fall of 0.62% to end the session at 12,737.060 and S&P/NZX 20 Index fell by 0.64% to 7,682.220. Also, S&P/NZX 10 Index encountered a fall of 0.60%. S&P/NZX All Materials fell by 2.99%. However, S&P/NZX All Financials increased by 1.34%. 

Macro Update: In the Fortnightly Economic Update dated 8th November, it was mentioned that, in Australia, government electricity subsidies and lower petrol prices limited consumer price increases to 0.2% in the September quarter, and the annual inflation rate fell to 2.8%, inside the RBA’s 2-3% target range. Despite the lower inflation, the RBA left the policy interest rate unchanged at 4.35% at its November review, noting that underlying inflation, which better demonstrates the inflation pressures, remains too high.  

Top Market Movers: Among top gainers, Radius Residential Care Limited (NZX: RAD) witnessed a rise of 7.14% to end the session at $0.225 per share. On the other hand, Blis Technologies Limited (NZX: BLT) declined by 5.26% to $0.018 per share.  

Commodity Update:  On Wednesday, the U.S. dollar lost some of its recent gains as investors were spooked by Ukraine's use of U.S. missiles in strikes on Russia, prompting fears of a potential nuclear escalation, although these concerns eased later. Attention also turned to former President Trump's selection of a Treasury Secretary as part of his team. In commodities, gold rose 0.48% to $2,643.75, silver gained 0.08% to $31.28, and copper increased 0.26% to $9,145 per ton. Brent crude edged up 0.1% to $73.40 a barrel, supported by tensions in Ukraine and growing Chinese crude imports, despite rising U.S. oil stocks. 

A graph showing the price of a stock market Description automatically generated

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 trading above its midpoint, indicating a positive short-term market sentiment. 

 
Our Stance: It could be said that the broader NZ market was impacted by the sell-off in materials sector. Moving forward, the geopolitical tensions might impact the sentiments of investors. Moreover, the global markets are expected to be impacted by the uncertainty regarding the rate cuts by the US Federal Reserve. Therefore, these uncertainties hint at the cautious stance. On 28th November, Stats NZ would be releasing employment indicators (October 2024).  

You Are a Few Steps Away From Gaining Smart Market Insights

Sign up/Login Now and Gain Access to Exciting Opportunities from Investor and Resource Space!