NZ sharemarket down 0.6% on eve of US tariffs
The New Zealand sharemarket fell on Tuesday, with shares in Fisher & Paykel Healthcare and Infratil dragged down by the threat of United States tariffs on Canada and Mexico, which will come into effect Wednesday.
Tuesday, March 4th 2025, 6:16PM
by BusinessDesk
The S&P/NZX 50 Index closed down 0.64% or 80.34 points, falling to 12,469.71. 33,272,091 shares changed hands, worth $133 million.
The other boards were also down. The S&P/NZX20 index closed at 7,469, down 0.64%, while the S&P/NZX10 index closed at 1,892.38, down 0.59%.
There were 42 gainers on the main board and 94 decliners.
Tariffs
Fisher & Paykel Healthcare was one of the day's big movers, with its share price falling by 1.21% to $33.50, down 41c.
Devon Funds Management's head of retail, Greg Smith, said President Donald Trump's imminent 25% tariffs on Mexico and Canada are having an impact.
“This has been something that the company has talked about. Obviously, the investors have been aware of it; now we’ve got the reality, barring an 11th-hour stay, which wouldn’t be perfectly surprising either,” Smith said.
“Assuming these turns actually remain in place, they could shift some production to New Zealand but that would come with a cost in terms of higher freight. They could also look to focus more on sales in Europe, which would be more tariff-free.”
He thinks the business will certainly face an earnings impact, potentially in the tens of millions of dollars to its bottom line.
Another stock of interest was Summerset Holdings, whose share price fell by 3.23%% to $12.28, down 41c.
“It’s still ahead of the game in terms of its result, which was quite a solid one, and eased some of the concerns over the sector given Ryman’s capital raise.”
Other stocks
More positive news: Spark performed well following its result last week, with its share price rising by 0.67% to $2.27, up 1.5c.
Freightways also had its share price rise by 1.73% to $11.19, up 19c.
Smith said the Reserve Bank of Australia’s (RBA) minutes would not have helped market sentiment. The RBA signalled more caution around further rate cuts, indicating that inflation overseas may be more sticky, particularly with the impact of any tariffs.
Smith said investors and analysts would be watching the results of the Global Dairy Auction overnight and Trump’s address to the American Congress.
“Obviously tariffs are really the big narrative at the moment, definitely the keyword in the market.”
US stocks closed sharply lower Monday after Trump appeared to confirm that tariffs on major trading partners Mexico and Canada would come into effect the following day.
“No room left for Mexico or for Canada,” Trump said at the White House when a reporter asked whether the levies would come into force from Tuesday.
“The tariffs, you know, they’re all set, they go into effect tomorrow,” he said.
The Dow Jones Industrial Average slipped 1.5% to 43,191.24, while the broad-based S&P lost 1.8% to finish at 5,849.72.
The tech-rich Nasdaq took a harsher tumble, closing down 2.6% at 18,350.19.
Among individual stocks, chip titan Nvidia slumped 8.7% after the Singaporean authorities announced a probe into whether servers containing its chips that ended up in Malaysia may have contravened US laws against chip sales to China.
According to Singapore's interior minister, K Shanmugam, US firms Dell and Super Micro Computer supplied the servers to Singapore-based companies. Super Micro's shares closed down 13%, while Dell’s fell 7%.
– Additional reporting AFP
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