NZ sharemarket rises strongly on power company gains

The S&P/NZX 50 Index closed up 1.36% or 167.48 points, rising to 12,494.71, with over 42 million shares changing hands to the value of $211.44m.

The S&P/NZX 20 index closed at 7,367.21, up 1.36%, while the S&P/NZX 10 index closed at 1,891.01, up 1.31%.

There were 95 gainers on the main board and 44 decliners.

Mercury NZ’s share price rose 4.24% to $5.90, up 24c, with 1,387,594 shares trading hands to the value of $8,131,438.69.

Meridian Energy was also firmer, with its shares up 3.05% to $5.75, up 17c, with 1,298,750 shares trading hands to the value of $7,412,509.88.

On Tuesday, Meridian announced New Zealand Aluminium Smelters’ plant at Tiwai Pt in Southland will ramp up production sooner than expected, thanks to improved hydro lake storage.

The smelter has a demand response agreement with Meridian that enables the power generator to request Tiwai, the country’s biggest power user, to reduce production when the system is stretched.

It also named British-based Kraken as a new technology partner that will help with a new billing platform for its 400,000 customers.

OECD predicts global growth to slow

The sharemarket rise came despite a report from the OECD which forecast global growth to slow from 3.3% in 2024 to 2.9% in both 2025 and 2026.

In its report on New Zealand, the OECD said an economic recovery was under way but the country would need to battle world trade headwinds.

Devon Funds Management's head of retail, Greg Smith, said there are still uncertainties on the trade front, although investors are optimistic about the prospect of further trade deals.

“A bright spot in the economy has been dairy, but we’ve now had a second consecutive [global dairy] auction with prices falling,” Smith said.

“Dairy prices have held up because of supply constraints, so production’s been weaker in the likes of the US and Europe, and that’s been a tailwind to New Zealand, where production has been strong and pricing has been strong.”

Shares in a2 Milk were up 3.93% to $8.73, up 33c, with 153,122 shares trading hands to the value of $1,329,506.65.

Vulcan Steel up

Vulcan Steel also saw its share price rise 6.4% to $7.31, up 44c, with 43,509 shares trading hands to the value of $310,474.24.

“The recent proposed increase in tariffs to 25-50% could arguably mean that steel prices outside of the US are going to come down as supplies are directed elsewhere.

“Steel distributors in Europe have been doing better in the last few days, so that makes sense,” Smith said.

Wall Street stocks bounced on Tuesday (US time) as investors hoped for upcoming trade deals to cool tensions from US President Donald Trump’s punishing global tariffs.

The Dow Jones Industrial Average closed 0.5% higher at 42,519.64, while the broad-based S&P 500 gained 0.6% to 5,970.37.

The tech-heavy Nasdaq Composite Index rallied 0.8% to 19,398.96.

In particular, Nvidia shares gained 2.8%, helping with the overall advance.

“The fact that we’re not down to me suggests that the market expects a trade deal to happen,” said Adam Sarhan of 50 Park Investments.

“It’s a matter of when, not if, at this point.”

He was referring to hopes of a potential deal between Washington and Beijing, although negotiations appeared deadlocked for now.

– Additional reporting by AFP.