Image Souce: Krish Capital Pty Ltd

Index Update: On 28th November 2024, the broader NZ market ended lower amidst sell-off in the industrials sector. On the same day, S&P/NZX 50 Index witnessed a decline of 1.21% to end the session at 13,053.560 and S&P/NZX 20 Index fell by 1.35%. Also, S&P/NZX 10 Index declined by 1.31%. S&P/NZX All Industrials witnessed a fall of 2.00% to end the session at 2,218.720. However, S&P/NZX All Materials rose by 1.14%.  

Macro Update: Recently, RBNZ stated that The Monetary Policy Committee agreed to reduce the Official Cash Rate by 50 basis points to 4.25%. The annual consumer price inflation has declined and is now close to the midpoint of the Monetary Policy Committee’s 1% - 3% target band.  The inflation expectations are also close to target as well as core inflation is converging to the midpoint.  

Top Market Movers: Among top gainers, Trade Window Holdings Limited (NZX: TWL) witnessed a rise of 9.30% to end the session at NZ$0.235 per share. On the other hand, Bremworth Limited (NZX: BRW) declined by 14.61%.  

Commodity Update:  Asian stocks were subdued on Thursday, while the U.S. dollar remained weak after U.S. data revealed that progress in slowing inflation had stalled, despite a resilient economy. This raised uncertainty about the Federal Reserve's next steps for the upcoming year. With the U.S. Thanksgiving holiday expected to keep trading volumes light, traders stayed cautious. In commodities, gold dropped by 0.50% to $2,651.40 per ounce, silver fell 1.12% to $30.21 per ounce, and copper declined by 0.06% to $9,017.50 per ton. Brent crude dipped by 0.10% to $72.79 per barrel, as a surprise rise in U.S. gasoline stocks dampened demand outlook. 

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. Moreover, the index recently surpassed its previous peak, reinforcing the ongoing uptrend. Furthermore, the 14-day Relative Strength Index (RSI) is heading north from its midpoint, indicating a positive short-term market sentiment. 

 
Our Stance: It could be said that the NZ equities were impacted by the sell-off in the industrials sector. Moving forward, NZ equities are expected to be affected by the momentum in the global markets. There is still some uncertainty with respect to the economic policies from Mr. Trump, which might influence the broader global markets. On 2nd December 2024, Stats NZ would be releasing data about building consents issued (October 2024).  

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