NZ Market Witnesses Selling Pressure

Image Source : Krish Capital Pty Ltd

Index Update: On 13th June 2025, the NZ market closed the broader trading session in red amidst sell-off in the technology sector. On the same day, S&P/NZX 50 Index witnessed a decline of 0.76% to end the session at 12,552.870 and S&P/NZX 20 Index fell by 0.71% to 7,393.910. Also, S&P/NZX 10 Index ended at 12,363.190, implying a fall of 0.71%. Notably, S&P/NZX All Information Technology witnessed a significant decline of 2.81% to 2,935.370.   

Macro Update: For the ten months ended 30 April 2025, core crown tax revenue stood at $100.4 Bn, and this was $0.7 billion (or 0.7%) above the forecasts. Notably, the corporate tax revenue was $0.4 Bn (or 3.3%) above forecast because of stronger than forecast Portfolio Investment Entity (PIE) tax. However, this was mitigated in part by weaker corporate terminal tax. The core crown expenses amounted to $115.8 Bn, which were $0.1 billion (or 0.1%) below the forecasts.   

Top Market Movers: Among top gainers, Rakon Limited (NZX: RAK) witnessed a rise of 7.27% to end at $0.59 per share. On the other hand, Being AI Limited (NZX: BAI) declined by 21.43%.   

Commodity Update: The U.S. dollar surged along with safe-haven currencies like the yen and Swiss franc after Israel reportedly launched strikes on Iran, according to U.S. officials. Explosions were also reported near Tehran. Gold jumped 1.68% to $3,460.15, silver rose 0.91%, while copper slipped 0.24%. Brent crude soared 7.63% to $74.65, reaching multi-month highs as fears of supply disruptions intensified amid escalating Middle East tensions.  

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 selling in the IT sector somewhat impacted the broader NZ market on 13 June 2025. As of now, the broader global markets are expected to be impacted by the intensifying geopolitical conditions amidst the recent attack on Iran. Furthermore, the uncertainty around the tariff policy might also weigh over the investors’ sentiments. Collectively, these factors hint at the cautious outlook for NZ and global equities. On 18th June, Stats NZ is expected to release data about balance of payments and international investment position (March 2025 quarter).