New Zealand Market Falls Sharply as Geopolitical Tensions Escalate

New Zealand stocks tumbled 177 points, or 1.3%, to 13,546 in Monday morning trade, snapping two sessions of gains as geopolitical tensions pressured sentiment. Weekend developments included U.S. and Israeli strikes on Iran, the reported death of Supreme Leader Khamenei, Iran’s retaliation against Gulf states, and the closure of the Strait of Hormuz. Traders also turned cautious ahead of PMI readings in top trading partner China later this week, with concerns building that the Lunar New Year holiday could dampen factory and services activity. Locally, January building permits are due after December’s sharp six-month drop. Still, losses were capped by optimism that monetary policy in New Zealand will stay accommodative, as signaled by the central bank. Nearly all sectors weakened, weighed by healthcare, energy minerals, and transport. Among single stocks, Ryman Healthcare slid 2.8%, followed by Genesis Energy (-2.6%), A2 Milk Co. (-2.4%), and Fletcher Building (-2.0%).

The NZX 50 rose 52 points, or 0.4%, to close at 13,723 on Friday, reversing early weakness and marking its highest finish in six weeks, driven by strength in tech services, logistics, and retail trade. The benchmark gained for a second straight session as traders shrugged off a sharp drop in U.S. futures after Wall Street’s S&P 500 and Nasdaq fell Thursday despite Nvidia’s strong earnings results. Local stocks also logged a second consecutive weekly advance and a solid monthly gain of 2.2%, supported by an indication that the Reserve Bank will maintain a dovish stance amid a manageable inflation outlook and improving economic output after years of stagnation. In top trading partner China, PMI readings for February are due next week, with local media noting a steady rise in consumption during the Spring Festival holiday. Top performers included T&G Global (4.3%), Hallenstein Glasson (3.4%), Millennium & Copthorne Hotels (3.0%), and Seeka Ltd. (2.4%).

New Zealand shares edged down 21 points, or 0.2%, to 13,649 in early Friday trade, reversing the prior day’s strength after Wall Street closed mostly lower Thursday, with Nvidia’s drop weighing on chip stocks. Traders also booked profits after the NZX 50 hit a five-week high. At the same time, fresh data showed both business and consumer confidence retreated in February amid pockets of weakness in the domestic economy. Caution also stemmed from upcoming February PMI readings in China, New Zealand’s top trading partner. Healthcare and energy minerals led declines, partly offset by gains in tech services and retail. Notable laggards included Genesis Energy (-2.1%), Summerset Group (-1.3%), and Fisher & Paykel Healthcare (-0.5%). Despite the pullback, the market is tracking its second straight weekly gain, with monthly strength near 1.6% so far, boosted by central bank signals of an accommodative policy rate and inflation projected to return to target mid-band over the coming year.