NZ sharemarket dips as Reserve Bank holds OCR steady

The RBNZ decided to leave the official cash rate (OCR) on hold at 3.25%, as widely expected.

On the main board, the S&P/NZX 50 Index closed down 0.70% or 90.41 points, falling to 12,768.61, with 30,992,457 shares changing hands to the value of $107.6 million.

The S&P/NZX 20 index closed at 7472.60, down 0.77%, while the S&P/NZX 10 index ended the day at 12,420.09, a fall of 0.86%.

There were 58 gainers on the main board and 78 decliners.

Salt Funds Management managing director Matt Goodson said the market had pulled back from the unusual strength in the match yesterday, likely down to KiwiSaver flows.

He said the Reserve Bank’s decision was largely as the market had expected.

“You’d have to term it a dovish hold because they’re trying to balance. Right now, growth momentum’s weak, but you can certainly see some hope for the future as past rate cuts feed through and as the rural boom feeds through,” Goodson said.

“At the same time, inflationary pressures have just picked up a bit in the short term, particularly from food prices, which obviously is also what’s behind the rural boom with dairy and beef.”

Goodson pointed to a2 Milk, which faced pressure for a second day after a weak update on the Chinese market.

“Even though it doesn’t directly impact a2, and it may be that a2 is taking share in that Chinese infant formula market, I think it’s put a bit of a cloud over the sector in the short term.

“There was also a broker downgrade out of Australia on it, so that might explain the weakness there.”

A2 Milk’s share price fell 34c to $8.04 after 644,945 shares traded hands to the value of $5,177,714.19.

Other large movements on the board on Wednesday included Precinct Properties and Kiwi Property Group, with the wider Property Index down roughly 1.7% after closing up 2.7% on Tuesday.

Precinct Properties had 1.16m shares change hands to the value of $1.44m, while Kiwi Property Group had 4.28m shares worth $4.1m traded.

Elsewhere, SkyCity Entertainment's shares were up 5.21% with 728,166 shares traded, worth $713,235.73.

Wall Street stocks dipped on Tuesday, falling for a second straight session as US President Donald Trump added tariff threats on copper and pharmaceuticals to his broadening trade agenda.

Trump announced plans for a 50% duty on copper imports and a potential 200% levy on pharmaceuticals a day after the White House sent letters to Japan, South Korea and other countries about levies from August 1.

The onslaught has reinstated trade top of mind on Wall Street after attention had focused on Capitol Hill and the Middle East in recent weeks.

The Dow Jones Industrial Average finished down 0.4% after a rollercoaster session at 44,240.76.

The broad-based S&P 500 slipped 0.1% to 6,225.52, while the tech-rich Nasdaq Composite Index was flat at 20,418.46.

In contrast to Trump’s spring tariff announcements, which sent equities sharply lower, the market is “somewhat shaking it off”, said Victoria Fernandez of Crossmark Global Investments, who noted Trump’s record of tempering tariffs that were initially severe.

– Additional reporting AFP