GDP beats forecasts, but NZ sharemarket dips

The S&P/NZX 50 Index closed down 0.46% or 58.27 points, falling to 12,569.05, with 109 million shares changing hands to the value of $438.6m.

The S&P/NZX 20 index closed at 7,390.37, down 0.63%, while the S&P/NZX 10 index ended the day at 1,887.70, a fall of 0.83%.

There were 71 gainers and 66 decliners on the main board.

GDP stronger than forecast

GDP grew at 0.8% in the first quarter of 2025, stronger than most economists’ forecasts.

The Reserve Bank of NZ (RBNZ) had forecast 0.4% for the quarter, but more recently, the consensus of economists had moved to 0.7%.

Salt Funds Management managing director Matt Goodson said that despite GDP being better than expected, it doesn’t really move the market.

“I think it was in line with what the market largely knows in terms of the domestic side of the economy. So it probably keeps the RBNZ’s decision on hold in July,” Goodson said. “If anything, there’s an implicit price deflate you can get out of GDP, which gives you a broader price measure than just the consumers price index.

"That was up 1.1% in the quarter, so there’s still a bit of inflation and green around.”

Waterman takes bite of My Food Bag

As for the domestic markets, late on Thursday came the news that Waterman Capital has bought back into My Food Bag.

Waterman Capital originally sold its share post-covid into the initial public offering with other founders.

“It’s a fascinating turn of events. I have to say the business does look as though it’s stabilised. If it will grow again is more of an open question.”

KMD warning

Elsewhere, a profit warning for Kathmandu parent KMD Brands worried investors, with its share price tumbling 6.78% to 27.5 cents, with 2.1m shares trading hands.

The outdoor retailer and wholesaler released its first full-year underlying earnings before interest, tax, depreciation and amortisation guidance, forecasting it will be between $15m and $25m.

The downgrade was driven by a 6.4% drop in Kathmandu sales over the first four months of the second half, reversing the positive sales trends disclosed in the company’s previous update.

Step towards energy centre

Genesis Energy announced it had, with gentailers Mercury, Meridian, and Contact, signed a detailed non-binding term sheet as a basis for establishing a strategic energy reserve centred on Huntly to support security of supply.

“That’ll clearly need a Commerce Commission take, but in terms of being a sensible strategy for the entire country, I think it gets a massive tick because we desperately need power to firm up all the renewables that have been added around the country,” Goodson said.

Shares in Genesis Energy rose 0.44% to $2.29, up 1c, with 1,030,453 shares changing hands to the value of $2.3m.

While shares in Mercury rose 1.94% to $6.04, up 11.5c, with 3,970,312 shares changing hands to the value of $23.8m.

Wall Street

Wall Street stocks ended little changed Wednesday after the Federal Reserve kept interest rates steady, while markets followed the ongoing fighting between Iran and Israel.

The Fed, as expected, held interest rates unchanged for a fourth consecutive meeting, as chair Jerome Powell said more time was needed to monitor the inflationary effects of President Donald Trump’s tariffs.

Meanwhile, Trump told reporters he has not yet decided on whether to join Israel in bombing Iran.

Stocks spent part of the day in positive territory, but the Dow Jones Industrial Average ended down 0.1% at 42,171.66.

The broad-based S&P 500 slipped less than 0.1% to 5,980.87, while the tech-rich Nasdaq Composite Index added 0.1% at 19,546.27.

- Additional reporting by AFP.