New Zealand’s share market caught up with the rest of the world as the global selloff in equity markets rippled throughout markets, hitting companies exposed to the US.
The S&P/NZX 50 index dropped 113.29 points, or 0.9%, to 12,225.289, taking its weekly decline to 0.5%. Trading was modest, with a turnover of $105.9 million across the main board.
The local stock market reversed its small gain on Thursday as investors digested the impact of US President Donald Trump’s global tariff regime, following the sharp response on Wall Street.
Asian markets remained in the doldrums as Australia’s S&P/ASX 200 index re-entered correction territory – down 10% from its peak – as it sank 2.2% in late trading, while Japan’s Nikkei 225 index fell another 3.5% and Hong Kong’s Hang Seng declined 1.5%. S&P 500 futures were down 0.6% after Thursday’s 4.8% slump.
“People are trying to get their heads around exactly what it means for them,” said Jeremy Sullivan, an investment adviser at Hamilton Hindin Greene. “The natural offset of the exchange rate is not going to be enough, even if New Zealand’s got off lightly.”
The kiwi dollar unwound gains against the greenback, trading at 57.33 US cents at 5pm in Auckland from 58.03 cents at 7am and 57.36 cents yesterday.
Tech stocks were among the hardest hit, following the 6% slide for the Nasdaq Composite on Thursday, with Gentrack leading the local market lower as it dropped 6.7% to $10.52. Vista Group International fell 3.3% to $3.56 and Serko declined 2.6% to $3.70.
Scott Technology climbed 7.4% to $1.88 after saying it has a limited exposure to the tariff regime with much of its North American revenue coming from Canada, while Rakon dropped 3.9% to 49 cents after saying between 15% and 20% of its revenue comes form direct US sales and it’s trying to fully understand the regime.
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Tourism Holdings fell 4.6% to $1.65, saying the impact of the tariff regime on North America remains unclear, but that it’s seen a decline in inbound travel to the US in recent weeks. Air New Zealand fell 3.2% to 60.5 cents.
Sanford fell 3% to $4.85 after saying it doesn’t expect a material impact from the tariffs on its sales to the US, which account for about 20% of revenue.
Retailers were also weaker after the slump in Amazon shares overnight, with KMD Brands – which has operations in the US – falling 5.5% to 34.5 cents, Warehouse Group declining 3.4% to 85 cents and Hallenstein Glasson Holdings slipping 2% to $8.04.
Skellerup sank 6.6% to $4.37, Fisher & Paykel Healthcare fell 1.8% to $34.58 and Delegat Group decreased 0.9% to $4.30.
Property companies and utilities dodged much of the tariff fallout, with Mercury NZ posting the biggest gain on the benchmark index, rising 2.3% to $5.88, and Contact Energy advancing 1.3% to $9.20. Vital Healthcare Property Trust increased 1.1% to $1.77 and Investore Property gained 1% to $1.06.
Spark New Zealand was the most heavily traded stock on the day with a volume of 4 million shares. It increased 0.5% to $2.08.
Sullivan said next week holds a likely rate cut from the Reserve Bank, although there’s still a lot of uncertainty for the central bank to digest from the tariff regime.
“They’ll be very concerned about the short-term impact on inflation, but medium term is potentially disinflationary,” he said. “People would look to get around tariffs any which way they can.”
Reporting by Paul McBeth. Image from Curious News.
