Infratil led the local share market lower as Auckland and Australian investors returned from their long weekend to discover an upstart Chinese artificial intelligence firm sent shockwaves through global markets while they were on holiday.
The S&P/NZX 50 index fell for a third day, down 42.57 points, or 0.3%, at 12,957.15, with a more respectable turnover of $124 million across the main board.
Infratil led the NZX50 lower, falling 3.6% to $11.20, joining the regional decline among tech companies and datacentres investors as China’s DeepSeek AI startup triggered a sharp selloff on Wall Street overnight, including a 17% slump for chipmaker Nvidia.
High-tech components maker Rakon sank 8.2% to 56 cents, while the power companies were also broadly weaker, with Meridian Energy falling 2.7% to $5.78, Genesis Energy declining 2% to $2.195, Contact Energy slipping 0.6% to $9.43 and Mercury NZ decreasing 0.5% to $6.02.
“The market’s been hesitating and waiting for something like this to happen so it can pull back a bit from what’s a fully valued market,” said Peter McIntyre, an investment adviser at Craigs Investment Partners.
The tech-heavy Nasdaq Composite sank 3.1% overnight, following the soft tone in Asia on Monday as investors weighed up the impact of a low-cost AI model, such as DeepSeek.
The response was muted from the likes of Nvidia, which said the Chinese company proved the need for more chips, while US President Donald Trump – who ushered in the US$500 billion-plus Stargate AI infrastructure investment last week – said it’s a wakeup call for American firms to innovate more cheaply.
Markets across Asia were mixed, with Japan’s Nikkei 225 down 1.2% at 5pm in Auckland, while Australia’s S&P/ASX 200 index edged up 0.04% and Singapore’s Straits Times Index increased 0.4%.
The Fed is coming
The kiwi dollar fell to 56.57 US cents at 5pm in Auckland from 56.83 cents at 7am and 56.90 cents yesterday, with the US Federal Reserve’s upcoming meeting where policymakers are expected to keep the benchmark interest rate unchanged in a range of 4.25%-to-4.5%.
Fisher & Paykel Healthcare declined 2.4% to $38.18 after Craigs Investment Partners noted the potential impact of Trump’s proposed tariff regime on the medical device maker’s earnings, and retained a neutral rating on the stock, while lifting its target price.
Sky Network Television slipped 1.7% to $2.94, having flagged on Monday that it’s assessing the impacts of its choice of satellite migration.
Meanwhile, Ebos Group posted the biggest gain on the NZX50, up 4.1% at $38. Across the Tasman, Sigma Healthcare rallied on news that its merger partner Chemist Warehouse – which Ebos still supplies in New Zealand – reported record sales in the six months ended Dec 31.
Green Cross Health, which operates the Life Pharmacy and Unichem brands, dropped 7.2% to 77 cents.
IkeGPS climbed 7% to 61 cents after reporting a strong December quarter. An unusually large volume of 4 million shares changed hands in a handful of trades.
Rua Bioscience slipped 3.3%, or 0.1 of a cent, to 2.9 cents after first-half sales beat expectations.
Being AI dropped 6.7% to 28 cents after independent director Brett O’Riley resigned, effective from the close of business on Wednesday or when a replacement director is appointed.
General Capital was unchanged at 26 cents after its finance company subsidiary reported a 9% growth of total assets in the December quarter.
Reporting by Paul McBeth. Image from Markus Winkler on Unsplash.
