NZX 50 Closes 1% Higher After RBNZ Hike

New Zealand equities rose 144 points, or 1.0%, to close at 13,931 on Wednesday, erasing losses from the previous session, after the RBNZ's monetary policy decision to hike interest rates by 25 bps. The RBNZ signaled its determination to return price growth to its 1% to 3% target range. The broader index rebounded from its lowest level since August 17, touched a day earlier, mainly boosted by gains in financials, consumer staples, communication services, and utilities. Rising oil prices, however, capped the gains, amid heightened inflation concerns and reinforced expectations of an interest rate hike amid escalating Middle East tensions. On the data front, New Zealand's consumer confidence eased slightly in August, while building permits continued to decline. Among the top gainers were Chorus (2.7%), Briscoe Group (2.5%), Mercury NZ (2.3%), A2 Milk (2.0%), Meridian Energy (1.5%), ANZ Group (1.3%), Fisher & Paykel (0.9%), and Mainfreight (0.8%).

New Zealand stocks were almost flat, trading around 13,789 in Wednesday morning trade, after retreating in the previous session and remaining at their lowest level since August 17, touched a day earlier, ahead of the RBNZ's monetary policy decision later today. The market expects the central bank to raise interest rates by 25 bps after raising rates in July. Caution also prevailed as rising oil prices raised inflation concerns and reinforced expectations of an interest rate hike amid escalating Middle East tensions. Gains in communication services, industrials, and financials offset declines in tech sectors, consumer staples, and consumer discretionary. On the data front, New Zealand's building permits fell 4.3% month-on-month in July, after declining 3.7% in June. Bankers Investment rose 1.5%, Ebos Group climbed 0.9%, while A2 Milk and Fletcher Building fell 0.7% and 0.5%, respectively.

New Zealand stocks lost 130 points, or 0.9%, to close at 13,787 on Tuesday, touching their lowest level since August 17 and erasing gains in the previous session, mainly weighed down by industrials, real estate, consumer discretionary, and consumer staples. The broader index tracked a decline on Wall Street overnight as rising oil prices raised inflation concerns and reinforced expectations of a Federal Reserve rate hike, amid escalating Middle East tensions. Traders were cautious ahead of the RBNZ's monetary policy decision this week, with the market expecting the central bank to raise interest rates by 25 bps after raising them in May. Traders continued to assess the government's decision to delay fuel excise rises from January 1, 2027, ahead of the general election, which is scheduled to be held in November 2026. Among the top decliners were Auckland International Airport (-3.2%), Ebos Group (-1.9%), A2 Milk (-1.6%), Infratil (-1.1%), and Contact Energy (-0.8%).