FX.co ★ NZX 50 Posts Largest Daily Loss in Over 5 Years

The S&P/NZX 50 index in New Zealand experienced a significant decline, dropping nearly 4% to settle at 11,793. This marks the steepest single-day fall since March 2020, resulting in the index closing at its lowest point since July of the previous year. This downturn was triggered by a prevailing risk-averse sentiment in financial markets, catalyzed by the recent comprehensive tariff announcement from the United States. The intensifying global trade tensions are particularly concerning for New Zealand's economy, which is heavily reliant on exports. The situation is exacerbated by the fact that China, New Zealand's largest trading partner, has been hit with substantial tariffs on almost all of its goods, raising total levies to 54%. Domestically, market participants are turning their focus to the upcoming policy decision by the Reserve Bank of New Zealand on Wednesday, with an anticipated 25 basis point rate cut due to cooling inflation, reduced economic output, and signs of emerging weakness in the labor market. All market sectors ended in negative territory, with significant declines seen in the financial sector, including Westpac Banking, which fell by 6.3%, and ANZ Group, which declined by 7.8%. Other major underperformers included Fisher and Paykel, Auckland International Airport, and Infratil, which saw decreases of 3.5%, 3.3%, and 3.2% respectively.