NZX50 joins global rally as optimism over Iran persists

New Zealand’s S&P/NZX 50 index snapped a three-day decline to join a global rally in equity markets, as US President Donald Trump signalled peace talks with Iran could resume within days after weekend negotiations failed to make much headway.

The power companies did the heavy lifting for the index, with Meridian Energy, Mercury NZ, Contact Energy and Genesis Energy all on the green side of the ledger, while gains for Fisher & Paykel Healthcare and Ebos Group provided a further tailwind.

Air New Zealand rose after Forsyth Barr research showed recent price hikes would ease pressure on the bottom line in the face of deepening losses, in a broadly stronger day for airlines with merger talk in the US and Virgin Australia following Qantas Airways in cutting domestic flights in the coming months.

And Comvita dipped after lifting the veil on its anticipated capital raising, bringing Singapore’s Fraser and Neave as a cornerstone shareholder in a $30 million renounceable rights offering to repay bank debt.

Rising tide

The NZX50 rose 59.32 points, or 0.5%, to 13,076.58, with 24 stocks gaining, 25 falling and one unchanged. Turnover across the main board was $137.5 million, of which Auckland International Airport accounted for $18.6 million as it slipped 0.4% to $8.18.

The country’s major gateway reported an 8% increase in international passenger movements in March from the same month a year earlier, while domestic travellers increased 3%.

The local market followed a global rally on growing optimism that the US and Iran will negotiate a lasting truce, with President Trump saying they could resume talks within two days and vice-president JD Vance saying negotiators made a lot of progress over the weekend, despite the mistrust between the nations.

Australia’s S&P/ASX 200 index was up 0.1% in late trading, while Japan’s Nikkei 225 index rose 0.9% and Hong Kong’s Hang Seng advanced 0.7%. Brent crude oil futures remained in check, up 1% at US$95.71 a barrel at 5pm in Auckland.

Greg Boland, market strategy consultant at Moomoo, said weaker oil prices and lower bond yields continued to support equities, especially growth stocks, but that the way forward was conditional.

“Progress in any negotiations could see risk assets extend higher, while any renewed disruption would likely bring volatility back into focus just as quickly,” Boland said in a note. “In short, markets are trading the possibility of resolution – not the reality of it.”

Domestically, heavyweight companies underpinned the NZX50’s gains. Meridian rose 2.5% to $5.65, Mercury advanced 2% to $6.73, Contact gained 1.3% to $9.49 and Genesis was up 0.9% at $2.23.

F&P Healthcare climbed 1.2% to $38.49, while Ebos led the market higher as it advanced 3.6% to $22.85 and Infratil increased 0.4% to $12.02.

Ryman Healthcare rose 3.9% to $2.14 after the retirement village operator said occupation rights sales rose 10% in the March quarter, taking annual sales to 1,410, the top end of guidance at its half-year result.

Chorus increased 0.2% to $9.43 after the broadband network operator reported a 13,000 increase in fibre connections in the March quarter, more than offsetting a 10,000 decline in copper connections.

Air New Zealand climbed 3.4% to 45.5 cents, with airlines across Asia rallying after United Airlines’ chief executive mulled a tie-up with rival American Airlines, while ASX-listed Virgin Australia joined carriers cutting flights in response to surging fuel prices. Virgin was up 8.1% in late trading, while Qantas gained 1.8%.

International inroads

Separately, Forsyth Barr analyst Andy Bowley said Air NZ’s price hikes were most marked on international routes, with domestic airfares already rising ahead of the fuel crisis.

“Our proprietary time series airfare data shows that quoted prices have increased materially in recent weeks, which will help soften the bottom line impact from higher fuel costs, though will also dampen demand given elasticities,” Bowley said in a note to clients. “The net impact will be deeper losses than those incurred in 1H26, adding pressure to Air New Zealand's balance sheet.”

Ministry of Business, Innovation and Employment data today showed a decline in New Zealand fuel stocks, with the changes enough to warrant ministers assessing the regime’s settings. However, officials advised against an assessment as the decline didn’t raise immediate concerns with one small shipment delayed – something the ministry said would probably become more common.

Import terminal Channel Infrastructure fell 0.7% to $3, after reporting a 2% increase in fuel throughput in the March quarter.

Courier operator Freightways fell 1.6% to $12.60 and logistics group Mainfreight dipped 0.1% to $58.14.

Vulcan Steel posted the steepest decline on the NZX50, falling 4.6% to $6.30, while Vista Group International dropped 4.5% to $1.80, unwinding some of Tuesday’s gain after Ord Minnett analysts lowered their price target 3.7% to A$3.10. Dual-listed Vista was down 3.9% at A$1.48 in late trading.

KMD Brands was the most heavily traded stock with a volume of 2.8 million shares changing hands as the retailer gained 1.5%, or 0.1 of a cent, to 6.8 cents. The New Zealand Superannuation Fund and Allan Gray increased their stakes after participating in the retailer’s placement.

Outside the benchmark index, Comvita fell 1.5% to 67 cents after announcing plans to raise $30 million through a renounceable rights offer at 65 cents a share. The offering is partially underwritten by Singapore-listed Fraser and Neave, which will take a 19.9% stake.

Scott Technology was unchanged at $2.50 after lifting its interim dividend to 4 cents per share as first-half earnings gained 7%.

Reporting by Paul McBeth. Image from Curious News.