The NZX 50 index experienced a modest increase of 13 points, or 0.1%, reaching 13,320 during a volatile Thursday morning trading session, marking its second consecutive gain. This rise was buoyed by optimism surrounding the possibility of further interest rate reductions. On Wednesday, Paul Conway, Chief Economist at the Reserve Bank of New Zealand (RBNZ), stated in an interview with Bloomberg TV that the Monetary Policy Committee remains receptive to additional rate cuts should they be deemed necessary.
Additionally, the market was positively influenced by the endeavors of US Treasury Secretary Scott Bessent to advocate for a prolonged suspension of elevated tariffs on Chinese imports. This move is part of efforts to address disputes concerning critical minerals. Despite these positive indicators, the market's upward momentum was restrained by lingering worries about the ongoing US government shutdown and persistent deflationary pressures in China, a key trade partner for New Zealand.
From the data standpoint, food inflation in New Zealand slowed to a five-month low of 4.1% in September, down from 5% in the previous month. The index found support primarily from gains in the financial, real estate, and materials sectors. Notable performers included Infratil, which rose by 2.1%, Mercury NZ and Ventia Services Group, both up by 1.7%, and Ebos Group and Kiwi Property Group, each gaining 1.0%.
