NZ Market Ends Significantly Lower

Image Source : Krish Capital Pty Ltd

Index Update: On 12th March 2025, the broader NZ market witnessed a sell-off amidst significant selling in the healthcare sector. On the same day, S&P/NZX 50 Index witnessed a fall of 1.30% to end the session at 12,249.550 and S&P/NZX 20 Index declined by 1.15% to close at 7,295.800. Also, S&P/NZX 10 Index encountered a fall of 1.57% to close at 12,013.890. Also, S&P/NZX All Health Care witnessed a significant fall of 3.46% to end at 2,928.710.  

Macro Update: Stats NZ released data about electronic card transactions (February 2025). For the February 2025 month, the spending in the retail industries rose 0.3% ($22 million) and spending in the core retail industries witnessed a rise of 0.5% ($28 million) as compared to January 2025. With respect to retail spending category, consumables were up by $16 million, apparel was up $3.4 Mn, and durables were down by $1.1 Mn.  

Top Market Movers: Among top gainers, Blis Technologies Limited (NZX: BLT) witnessed a rise of 7.69% to end at $0.014 per share. On the other hand, Move Logistics Group Ltd (NZX: MOV) declined by 8.33% to $0.22 per share. 

Commodity Update: The U.S. dollar remained near a five-month low on Wednesday, weighed down by ongoing concerns over the U.S. economy amid President Donald Trump’s erratic trade policies. Analysts noted that the country’s growth outlook continued to weaken, heightening focus on the upcoming consumer price index (CPI) release, which could lead to market volatility. In commodities, gold rose 0.14% to $2,924.90, silver climbed 0.67% to $33.36, and copper surged 0.84% to $9,731.30. Brent crude increased 0.40% to $69.83, supported by the weaker dollar, though fears of a U.S. slowdown and tariff effects limited further gains. 

Source: Trading View, Analysis: Kalkine Group   

In July 2024, the S&P/NZX 50 index broke above both the neckline of a Head and Shoulders pattern on the daily chart and a crucial resistance level set by its 2023 high. This breakout suggests that the uptrend, which began in November 2023, is likely to continue and may drive the index toward its 2021 historical peak. Despite the ongoing correction, the index is bouncing back above the key support level defined by the 2023 high and the pattern’s neckline, reinforcing expectations of a sustained uptrend. Additionally, the 14-day Relative Strength Index (RSI) is trading near its oversold territory, signaling a potential rebound in the near future.  

Our Stance: It seems that the sell-off in the healthcare sector impacted the broader NZ market on 12th March. As of now, it can be said that the global investors are concerned about the US recession amidst uncertainties related to the trade policy. RBNZ recently stated that a period of restrictive interest rates resulted in lower demand in the NZ economy as well as contributed to reduced inflation. Notably, subdued global economic activity, declining net immigration as well as lower government consumption have led to slowed domestic demand.