NZX 50 sinks as bond yields keep climbing; RBA hikes

New Zealand’s S&P/NZX 50 index fell in a broad-based selloff as rising bond yields and elevated oil prices continued to weigh on rate-sensitive firms, with Ryman Healthcare sinking to a 16-year low in heavy trading.

The Reserve Bank of Australia delivered a rate hike as expected, with the board saying inflation was still too high and that the central bank would do what it took to bring it back within a sustainable target.

OpenAI canned the release of its GPT-6.1 Astra model over safety concerns raised during internal testing, while Anthropic’s prospectus leaked, showing the Claude developer reported a net loss of US$42 billion in 2025 and planned to spend US$518 billion on cloud, computing and infrastructure in the coming years.

And Hallenstein Glasson Holdings hit an all-time high after delivering a strong annual result and said it started another uncertain year on an upbeat note.

Oil and bonds

The NZX 50 fell 147.05 points, or 1.1%, to 13,683.63, with 38 decliners, eight gainers and four unchanged. The S&P/NZX 20 index futures contract for December dropped 0.9% to 7,575, with 150 lots traded for a value of $1.1 million, while the NZX 20 slid 1.3% to 7,517.57.

Turnover across the main board was $209.8 million, of which Ryman Healthcare accounted for $49.9 million in an unusually large volume of 27.7 million shares changing hands as the retirement village developer dropped 3.1% to $1.85. Of that, almost 25.8 million was traded in a single block at $1.80 a share.

Stock markets across Asia were broadly weaker as Brent crude oil futures rose 1.6% to US$106.97 a barrel at 5pm in Auckland, and pushed up bond yields as investors demanded increased returns.

After New Zealand’s market closed, the RBA unanimously raised its target cash rate a quarter-point to 4.6%, with the board saying inflation remained elevated and that governors would hike further if needed.

Rate-sensitive companies led New Zealand’s stock market lower, with software company Serko sliding 3.8% to $1.28 and Vista Group International down 3.2% at $2.69, while retirement village operator Summerset Group Holdings dropped 3.2% to $7.22. Stride Property fell 2.3% to $1.06 and Property for Industry declined 2.2% to $2.22.

“Yields are higher and interest rates are higher, and that’s negative for the property market,” said Peter McIntyre, an investment adviser at Craigs Investment Partners.

Powering down

Power companies declined, with Meridian Energy falling 2.9% to $5.42, Genesis Energy down 2.8% at $2.48, Mercury NZ slipping 0.4% to $6.90 and Contact Energy decreasing 1.5% to $8.60.

Infratil – often seen as the domestic AI proxy – fell 1% to $13.89 after OpenAI scrapped the launch of its latest model, and as details of Anthropic’s prospectus for a US$2 trillion initial public offering emerged.

Hallenstein Glasson hit a record $14.28, ending the day up 5.7% at $14 to post the biggest gain on the day. The retailer declared a fatter dividend as it lifted annual profit 50% on wider margins and increased sales.

Craigs’ McIntyre said the company’s first eight weeks of trading were pretty strong in a relatively positive result.

Fonterra Shareholders’ Fund units rose 3.2% to $8.82, while Gentrack increased 1.9% to $3.77 and Sky Network Television advanced 1.7% to $3.70.

Tourism Holdings gained 1% to $2.93 after the rental campervan operator said the competing due diligence processes by its pair of suitors were taking longer than anticipated, with an update expected by the time of its annual meeting on Nov 6.

Meanwhile, the Treasury’s pre-election economic and fiscal update showed forecast surpluses in the 2029 fiscal year would be wider than previously thought, albeit before taking into account the latest flare-up in the Middle East conflict.

The kiwi dollar traded at 56.63 US cents at 5pm from 56.69 cents, while the yield on the 10-year government bond was unchanged at 5.13%.

Mark Smith, a senior economist at ASB Bank, said the forecasts showed a stronger fiscal picture compared to the May budget, although forecasting a surplus was different to actually achieving one.

“The climb in NZ’s public debt since the GFC has constrained the ability of fiscal policy to support the economy in what looks to be an increasingly less benign global backdrop,” Smith said in a note. “The key takeout for political parties jostling to occupy the Treasury benches is that NZ faces long-term fiscal challenges posed by population ageing, climate change and infrastructure requirements.”

Reporting by Paul McBeth. Image from Curious News.