NZX50 rallies, kiwi slumps as Reserve Bank looks to cut deep
Spark’s return to being a telco was well-received.
New Zealand’s S&P/NZX 50 index hit a high for the year, while the kiwi dollar nose-dived after the Reserve Bank signalled interest rates are going lower after delivering today’s expected reduction.
Spark New Zealand led the local benchmark higher after the telecommunications firm outlined a new strategy to refocus on the core business that delivers reliable returns to its shareholders.
Fletcher Building was also stronger in unveiling an ocean of red ink as it booked $702 million of one-off costs in the new leadership team’s reset to transform and simplify the business, getting a more welcome reception that Australia’s James Hardie which slumped 28% after missing analysts’ expectations.
And Me Today announced plans to raise $2.6 million to keep investing in the brand, with founding shareholders Grant Baker and Stephen Sinclair partially underwriting the offer.
Peeking above 13k
The NZX50 climbed rose as high as 13,138.76 today, its highest level this year, and ended the day up 1.1% at 13,071.3, with 29 stocks gaining, 15 declining, and six unchanged. Turnover across the main board was $208.9 million.
The local bourse got an extra shove after the Reserve Bank cut the official cash rate a quarter-point to 3% as expected, but noted two members of the monetary policy committee pushed for a 50 basis point reduction. The track for the OCR now shows the benchmark rate falling to 2.7% in the December quarter and 2.5% in the first three months of 2026.
“What we have here is a change in strategy where the RBNZ is choosing to look through the CPI inflation outlook for the next six months and instead take action to underwrite an improvement in growth,” Westpac NZ chief economist Kelly Eckhold said in a note. “The RBNZ likely won’t move away from this insurance strategy until totally comfortable that the economy is on track to grow at rates that will eliminate the current spare capacity.”
The kiwi dollar dropped to 58.27 US cents at 5pm in Auckland from 58.95 cents at 7am and 59.26 cents yesterday, with the yield on the 10-year government bond down 10 basis points at 4.41%.
Interest rate sensitive stocks such as utilities and commercial landlords were broadly stronger. Meridian Energy increased 2.3% to $5.65 and Contact Energy advanced 2.3% to $9.19, while Precinct Properties NZ gained 2.4% to $1.275 and Stride Property Group rose 2.4% to $1.28.
Fisher & Paykel Healthcare, which benefits from a weaker currency, climbed 1.9% to $37.65, while Freightways – a favoured bellwether of the economy – increased 2.1% to $12.05.
Resuming normal service
Spark New Zealand led the NZX50 higher, climbing 3.6% to $2.57 as it met analysts’ forecasts in reporting a decline in annual earnings, and unveiled a rejigged strategy focusing on its core connectivity businesses to deliver reliable dividends to its shareholders. The telco was the most heavily traded stock on the day with a volume of 6.6 million shares.
Fletcher Building gained 0.3% to $3.08 after reporting a loss of $419 million in the June year, including $702 million of one-off costs, as the building materials firm overhauls the business under its new leadership team. That’s in contrast to the 28% slump for James Hardie on the ASX after the building materials firm fell short of analysts’ expectations.
The dual-listed banks were stronger, with Westpac Banking Corp up 3.6% at $42.10 on the NZX and ANZ Group Holdings rising 3.3% to $36.88. Heartland Group Holdings gained 2.5% to 82 cents.
Oceania Healthcare posted the biggest decline on the benchmark, down 1.5% at 66 cents, while rubber goods maker Skellerup Holdings slipped 1.3% to $4.70, Serko fell 1.2% to $2.55 and Mainfreight decreased 1% to $59.
NZX was unchanged at $1.46, with an unusually large volume of 4.1 million shares changing hands.
Outside the benchmark, skincare and supplement firm Me Today was unchanged at 7.3 cents after signalling plans to raise $2.6 million in a one-for-one rights issue at 6 cents a share, partially underwritten by founding shareholders Grant Baker and Stephen Sinclair. The firm also said annual revenue climbed 42% to $5.8 million in the June year.
Reporting by Paul McBeth. Image from Curious News.
