NZ Market Witnesses Broad-based Recovery After Huge Sell-off

Image Source : Krish Capital Pty Ltd

Index Update: On 8th April 2025, the broader NZ market witnessed a broad-based recovery amidst buying in the energy sector. On the same day, S&P/NZX 50 Index witnessed a rise of 0.98% to end the session at 11,891.440 and S&P/NZX 20 Index rose by 1.13% to 7,059.900. Also, S&P/NZX 10 Index encountered a rise of 1.01% to 11,698.570. Notably, S&P/NZX All Energy increased by 2.78% to close the session at 1,657.230. However, materials sector ended in red, and S&P/NZX All Materials declined by 3.74% to 1,048.150.  

Macro Update: As per Stats NZ, the seasonally adjusted industry and household greenhouse gas (GHG) emissions in Aotearoa New Zealand fell 2.0% in the December 2024 quarter. The decline was mainly because of the result of a 45% reduction in emissions from electricity, gas, water, and waste services in the quarter ended December 2024. There were significant falls in the amount of fossil fuels utilized for electricity generation in the December 2024 quarter, which resulted in an overall decline in carbon dioxide emissions from industry.  

Top Market Movers: Among top gainers, New Talisman Gold Mines Limited (NZX: NTL) witnessed a rise of 8.70% to $0.075 per share. On the other hand, Radius Residential Care Limited (NZX: RAD) fell by 6.52% to $0.215 per share. 

Commodity Update: On Tuesday, the U.S. dollar weakened as markets reacted to growing recession fears following President Trump’s sweeping tariffs. Gold rose 1.32% to $3,012.90, silver climbed 1.57% to $30.07, and copper edged up 0.54% to $8,796.00. Brent crude ticked up 0.11% to $64.93, slightly recovering from recent lows. Oil prices had recently hit a four-year low amid concerns over waning demand, with Trump’s new tariffs on key economies set to begin Wednesday.  

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, after a sharp decline, the index is nearing 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 rebound from the mentioned support level.  

Our Stance: It could be said that the broad-based recovery in the NZ market hints at some sort of investor optimism amid market volatility. That being said, the current macroeconomic worries, including heightened trade tensions as well as the uncertainty around tariffs can impact the global and NZ markets. Apart from these worries, the broad-based market momentum is expected to be influenced by earning results from the companies.