NZ Market Ends Marginally Lower

Image Source : Krish Capital Pty Ltd

Index Update: On 6th June 2025, the broader NZ market closed the session marginally lower amidst selling in the IT sector. On the same day, S&P/NZX 50 Index witnessed a decline of 0.11% to end at 12,563.480 and S&P/NZX 10 Index declined by 0.39% to end at 12,381.210. Also, S&P/NZX 20 Index fell 0.11% to 7,410.730. Notably, IT sector encountered selling pressure, and S&P/NZX All Information Technology fell by 1.43% to 3,034.510. However, S&P/NZX All Energy rose by 1.44%.  

Macro Update: RBNZ recently announced that the Committee decreased the OCR by 25 bps from 3.50% to 3.25%. The inflation is within the target band, and the Committee remains well-positioned to respond to domestic as well as international developments in order to maintain price stability over the medium term. The annual CPI inflation is expected to rise to 2.7% in Q3 FY 2025.   

Top Market Movers: Among top gainers, WasteCo Group Limited (NZX: WCO) rose by 11.11% to $0.020 per share. On the other hand, Vital Limited (NZX: VaaTL) declined by 5.95% to $0.395 per share.  

Commodity Update: The dollar faced a weekly decline on Friday amid weak U.S. economic data and stalled trade talks ahead of a key deadline. Markets awaited the U.S. nonfarm payrolls report for further cues. Gold rose 0.30% to $3,385.55, silver gained 1.06% to $36.17, and copper edged up 0.28% to $9,749.45. Brent crude slipped 0.12% to $65.22 but was set for its first weekly gain in three weeks.  

Source: Trading View, Analysis: Kalkine Group   

Following a sustained upward rally that began in October 2023, the S&P/NZX 50 index appears to be transitioning into a consolidation phase. This is evidenced by the formation of a lower high and a higher low on the chart - typically a technical signal that the market may be entering a trading range. Unless there is a clear breakout above the previous resistance level at 12,881 points or a breakdown below the earlier support level at 12,254 points, this sideways movement is expected to persist in the near term. Additionally, the 14-day Relative Strength Index (RSI) is currently hovering around its midpoint, which reinforces the previous outlook. As a result, investors may need to wait for a decisive move in either direction before gaining greater clarity on the market’s next trend.  

Our Stance: It could be said that the selling in the IT sector somewhat impacted the broader NZ market on 6th June. In the recent past, the US and China decided to temporarily reduce the tariffs, which supported the broad-based equity markets. While there are still some uncertainties, the investors are required to keep a close watch on trade developments as these can influence the markets. Over the next few trading sessions, the markets might react to macro-economic releases. On 11th June, the US is expected to release data about consumer price index.