NZX50 slides 4.7% in March qtr on SaaS fears, Middle East conflict

New Zealand’s S&P/NZX 50 index dropped 4.7% in the March quarter as tech companies fell out of favour amid concerns over artificial intelligence encroaching on software firms, while US President Donald Trump’s attacks on Iran sparked a wave of fear that central banks will have to hike interest rates as oil prices spiked.

Much of the quarterly slide came in March, which was the NZX50’s worst month since January 2022, with local software firms Serko, Vista Group International and Gentrack at the bottom of the leaderboard as they felt the double-whammy of the AI threat and rising interest rates, while retirement village operators Summerset Group Holdings, Ryman Healthcare and Oceania Healthcare dropped sharply through the quarter.

A late reprieve in Tuesday trading eased some of the period’s pain, with the NZX50 joining a broad rally across Asia amid reports Trump is willing to end the conflict in Iran even if the Strait of Hormuz doesn’t reopen, with heavyweights Fisher & Paykel Healthcare, Meridian Energy, Infratil and Auckland International Airport buoying the benchmark.

And KMD Brands unveiled its deeply discounted capital raising and first-half result, tapping institutional investors for $6.8 million of a $65 million injection to shore up the retailer’s balance sheet.