New Zealand Share Market Dips on Weak Export Data as S&P/NZX 50 Falls 0.99%

The New Zealand share market closed lower on Monday, with the S&P/NZX 50 Index falling 0.99% to 12,883.69, as weak export data raised concerns about the country’s economic outlook. The decline came despite ongoing corporate activity and a buoyant US stock market, where major indices reached record highs.

Weak Export Data Sparks Concern

According to Statistics New Zealand, goods exports dropped 3.7% to $19.7 billion in the June quarter, marking the first decline since Q3 2023. This came after a strong 11% increase in the previous quarter. The quarterly trade balance also showed a deficit of $709 million.

Jeremy Sullivan, an investment adviser at Hamilton Hindin Greene, noted that the weak trade data, combined with recent inflation figures, could provide the Reserve Bank of New Zealand with grounds to cut the Official Cash Rate (OCR) in August. “The market is already pricing in this move,” he said.

Key Stock Movements

Fishers & Paykel Healthcare, one of the largest contributors to the local index, fell 1% to $36.69. Other major stocks also declined, including Auckland International Airport (-2.5%), a2 Milk (-0.7%), Freightways (-1.69%), and Mainfreight (-1.2%).

However, Fletcher Building saw a small gain of 0.3% to $3.06 after announcing it was exploring the possibility of divesting parts of its Construction Division. Sullivan said the move could help the company reduce debt and free up capital.

Sky TV Buys TV3 in $1 Deal

Among the positive performers was Sky TV, which rose 4.8% to $3.06 after announcing its agreement to acquire 100% of the financially struggling TV3 for $1. Sullivan noted that while TV3 is currently loss-making, the acquisition could provide cost-saving opportunities in the long term.

Black Pearl Group Surges on Strong Performance

Data technology company Black Pearl Group was the standout performer, rising 7.1% to $1.20. The company reported $14 million in annual recurring revenue (ARR) in its first quarter and announced plans to acquire B2B Rocket, which would boost its ARR to $17.5 million—a 105% increase from the previous year.

Meanwhile, aged care company Third Age Health rose 0.9% to $4.32 after its CEO, Tony Wai, announced his resignation, effective from October. Wai said the company is well-positioned for continued growth despite the leadership change.

US Market Performance

Meanwhile, the US stock market continued its upward trend, with the Nasdaq and S&P 500 reaching new record highs. Investors are optimistic about the upcoming reporting season, with major companies like Tesla and Alphabet (Google) set to release their quarterly results this week.

As the New Zealand market grapples with weak export data and economic uncertainty, investors are closely watching the Reserve Bank’s next move and the potential impact of corporate strategies on the local economy.