New Zealand Stocks Trade Slightly Lower

The NZX 50 dropped 19 points, or 0.1%, to 13,616 in Thursday morning deals, retreating for the fourth consecutive session, mainly weighed down by losses in technology, financials, and utilities. Traders were cautious ahead of the release of June food inflation data due on Friday after the figures accelerated in May. Investors also continued to monitor developments in the Middle East conflict, amid rising oil prices, as inflation concerns fueled expectations of further interest rate hikes. On Tuesday, RBNZ Chief Economist Paul Conway warned that sticky inflation, driven by recent Middle East supply shocks, could prompt further interest rate hikes. Caution also prevailed after disappointing data from China, New Zealand's top trading partner, showed that the country's economy grew at its slowest pace in 3-1/2 years. Port of Tauranga fell 1.2%, Auckland International Airport shed 0.7%, Henderson Far East Income dropped 0.7%, Ebos Group went down 0.4%, and Chorus declined 0.3%.

The NZX 50 dropped 16 points, or 0.1%, to close at 13,635 on Wednesday, reversing its morning strength and posting a third consecutive session of losses, mainly weighed down by declines in consumer staples, communication services, healthcare, and real estate. Rising oil prices amid the escalating conflict in the Middle East continued to pressure sentiment as inflation concerns fueled expectations of further interest rate hikes. Traders also continued to assess a warning from RBNZ Chief Economist Paul Conway that sticky inflation, driven by recent Middle East supply shocks, could prompt further interest rate hikes. Disappointing data from China also weighed on sentiment, as China's economy grew at its slowest pace in 3-1/2 years. However, a rally on Wall Street overnight helped limit the losses as softer inflation eased expectations of a Fed interest rate hike. Among the biggest laggards were A2 Milk (-2.0%), Mainfreight (-1.1%), Chorus (-1.0%), and Fisher & Paykel (-0.6%).

The NZX 50 climbed 24 points, or 0.2%, to 13,675 in Wednesday morning trade, erasing losses from the previous two sessions, tracking gains on Wall Street overnight as softer inflation eased expectations of a Fed interest rate hike. The energy, materials, and healthcare sectors mainly drove the index. However, declines in real estate and information technology capped the gains. Traders also continued to assess a warning from RBNZ Chief Economist Paul Conway that sticky inflation caused by recent Middle East supply shocks could lead to further interest rate hikes. They also studied a statement from Fed Chair Warsh, who said he remained fully committed to restoring price stability and had no tolerance for persistently elevated inflation. On the data front, New Zealand's electronic card spending fell 1.4% mom in June, reversing a downwardly revised 1.6% increase in May. Among early gainers were AFT Pharmaceuticals (0.8%), Ebos Group (0.8%), and Fisher & Paykel (0.6%).