NZ Market Saw Robust Buying Amidst Strong Momentum on Wall Street

Image Source : Krish Capital Pty Ltd

Index Update: On 10th April 2025, the broader NZ market ended significantly higher after the Wall Street encountered robust buying momentum. On the same day, S&P/NZX 50 Index witnessed a rise of 3.34% to end the session at 12,201.430 and S&P/NZX 20 Index rose by 3.39% to 7,250.550. Also, S&P/NZX 10 Index encountered an increase of 3.75% to close at 12,066.320. Notably, significant buying was encountered in the materials sector and S&P/NZX All Materials rose by 6.31%.  

Macro Update: Recently, RBNZ stated that the Monetary Policy Committee agreed to reduce the Official Cash Rate by 25 basis points to 3.5%. The annual consumer price inflation remains near the mid-point of the committee’s 1% - 3% target band. Notably, the economic activity in NZ evolved largely as anticipated since the February Monetary Policy Statement. The higher-than-anticipated export prices as well as a lower exchange rate supported primary sector incomes as well as overall economic growth.  

Top Market Movers: Among top gainers, Radius Residential Care Limited (NZX: RAD) witnessed a rise of 17.02% to end at $0.275 per share. On the other hand, Rua Bioscience Limited (NZX: RUA) fell by 7.41%.  

Commodity Update: The U.S. dollar weakened against the yen and Swiss franc Thursday as President Trump escalated the trade war with China, raising tariffs to 125% while pausing others for 90 days. Gold rose 2.00% to $3,141.60, silver gained 2.27% to $31.10, and copper surged 4.03%. Brent crude fell 1.10% to $64.79 amid weak Chinese inflation data. Oil prices cooled after previous gains, as Trump’s tariff delay eased fears of a global recession. 

Source: Trading View, Analysis: Kalkine Group   

Following a break below the upward trendline that had held since November 2024 and showing signs of weakness, the S&P/NZX 50 index has continued to fall beneath a key support level — the neckline of a Head & Shoulders formation — suggesting the potential for further downside. This bearish momentum may push the index toward a major support zone around 11,500 points. At present, the index is rebounding near this strong support area and showing early signs of stabilization, with a possible bullish divergence emerging on the 14-day Relative Strength Index (RSI) in its oversold territory. This could signal a possible recovery in case the index manages to surpass its previous peak at 12,400 points.  

Our Stance: It could be said that the broader global and NZ markets are reacting to the news related to the tariffs. Overall, the global markets ended higher after the President Trump announced its decision to pause tariffs. That being said, it highlights the volatility of global and NZ markets. Overall, the broader economic factors, including the worries related to the uncertain trade policies and their impact on inflation, pose significant risks. Also, the market players are required to closely track the developments around the interest rates.