The New Zealand sharemarket opened the week largely unchanged as investors grappled with heightened geopolitical tensions, climbing oil prices, and continued volatility in technology stocks. The S&P/NZX 50 index closed at 13,696.03, edging up just 1.35 points or 0.01%, following an intraday low of 13,622.58. Market activity saw 65 stocks rise and 73 decline, with turnover amounting to 23.1 million shares valued at NZ$94 million.

Market sentiment has been dampened by escalating conflict in the Middle East, particularly between the United States and Iran, which has renewed concerns over oil supply disruptions. Investment director Mark Lister of Craigs Investment Partners highlighted that investors remain cautious amid these developments. Brent crude oil prices reached above US$90 per barrel, a 20% increase since the end of June, contributing to unease given fuel price pressures and broader market volatility, especially within technology and semiconductor sectors.

Lister noted that this week is critical for the US earnings season, with around 80 companies in the S&P 500 scheduled to report results, including major tech companies Alphabet and Tesla. Despite global headwinds, Lister said New Zealand’s market has held up relatively well compared to declines overseas. However, much depends on how the Middle East situation unfolds, including whether oil prices rise above US$100 or if the Strait of Hormuz faces closure, or alternatively, if diplomatic efforts can ease tensions.

Over the weekend, US markets saw declines, with the Nasdaq Composite down 1.4% to 25,520.24 points, the S&P 500 slipping 1.01% to 7,457.69, and the Dow Jones Industrial Average falling 0.78% to 52,146.42. Weekly losses were significant as well, with the Nasdaq off nearly 3%, the S&P 500 dropping 1.6%, and the Dow falling 0.9%.

Investor focus also turns to domestic inflation figures due later this week, with expectations that the June Consumer Price Index (CPI) will show inflation remaining above the Reserve Bank of New Zealand’s target range. Brokerage ASB forecast annual inflation could rise to 4% compared to 3.1% in March, though still below earlier projections. ASB also cautioned that deteriorating US-Iran relations threaten to sustain upward pressure on inflation through higher oil prices.

On the local market, most major stocks recorded minor movements. Fisher & Paykel Healthcare declined 23 cents to $39.70, while Infratil and Ebos Group decreased modestly. Other falls included Gentrack and Oceania Healthcare, while smaller firms such as Solution Dynamics and Comvita fell by over 4%. Heartland Group edged down amid public opposition to its proposed merger with TSB Bank in Taranaki.

In contrast, several stocks posted gains: Chorus rose 17 cents to $9.79, Auckland International Airport climbed 11 cents, and a2 Milk increased 20 cents to $8.57. Shares in Spark, SkyCity, Air New Zealand, Ventia Services, and PGG Wrightson also saw modest rises.

Separately, Fletcher Building maintained its price at $3.75 after the New Zealand government announced a $60 million grant to support Golden Bay Cement’s operations in Northland. The grant aims to secure continued domestic cement production, with Fletcher and Golden Bay committing to operate the plant until at least 2040 and invest $150 million over this period. Golden Bay is New Zealand’s sole domestic cement manufacturer, supplying nearly 60% of the country’s demand.

In the property sector, Vital Healthcare Property Trust reported an expected net portfolio gain of NZ$10 million for the six months to June, driven by rental increases despite a softening capitalization rate. Precinct, Stride, and Kiwi Property saw modest share price rises, while Investore edged lower.