Yovich & Co Market Update - 27 October 2026.

The NZX 50 slipped approximately 0.14% over the week to 13,733.93. Shares fell on Monday, recovered almost 1% on Wednesday, then eased over the final two sessions. The main domestic economic news was inflation. Consumer prices rose 0.7% in the September quarter, taking annual inflation to 3.7%, down from 4.1% in June but still above the RBNZ’s 1–3% target range. Petrol prices fell during the quarter but remained 19.1% higher than a year earlier, while electricity prices rose 9.3% annually. Prices influenced by overseas markets increased 4.3%, compared with 3.3% for domestically driven prices. Expectations remain tilted towards a 0.25 percentage point OCR increase this Wednesday, although the decision is not certain.

The All Ordinaries declined approximately 0.39% to 8,905.80, although performance varied considerably across sectors. Financial shares gained around 4%, helping offset a 7.7% decline in the ASX 200’s materials sector. BHP, Rio Tinto and Fortescue all weakened as falling metal prices and company-specific concerns weighed on mining shares. Technology stocks fell approximately 5.1%, while gold shares dropped around 10.1%. Concerns about the cost and profitability of artificial intelligence investment added to pressure on technology companies, while weaker commodity prices hurt resource producers. The strength in banks helped keep the overall market’s weekly decline relatively modest.

The Shanghai Composite declined approximately 0.70% to 3,690.48, despite recovering 0.9% on Friday as increased buying by state-backed funds helped support the market. China’s headline economic growth was stronger than expected, with GDP increasing 4.5% from a year earlier, ahead of the 4.4% forecast and up from 4.3% in the June quarter. However, the recovery remained uneven. Industrial production grew solidly, but retail sales increased just 1.1% in September and investment remained weak. This suggests that stronger manufacturing activity has yet to translate into a broad recovery in household spending and business confidence.

The FTSE 100 fell approximately 1.79% to 10,690.36, reversing part of the previous week's strong gain. The index was particularly weak on Monday and finished Friday another 0.3% lower. The main pressure came from higher inflation, rising oil prices and renewed expectations for another Bank of England rate increase. September UK CPI accelerated from 3.1% to 3.5% year-on-year, while core CPI increased from 2.6% to 2.8%. Transport and fuel prices were the largest contributors.

The Dow gained approximately 0.41%, while the Nasdaq fell around 0.71%. The S&P 500 also declined approximately 0.5%. This continued the recent rotation away from expensive technology shares and toward more traditional, defensive and smaller companies. The Nasdaq remained under pressure from questions around AI valuations and the enormous amount of debt and capital expenditure being committed to data centres and AI infrastructure. Thursday was particularly weak, with semiconductors suffering their largest daily decline since June after renewed concerns about whether the scale of AI spending will generate sufficient returns. However, the US economy remains very strong. The October flash Composite PMI was 57.6, only slightly below September's five-year high of 58.4. New orders climbed to 58.2, their strongest level since 2022.

Investment News

Scott Technology (NZX: SCT) – Record Result as Automation Demand Grows
Scott Technology delivered a record FY26 result, with revenue up 7% to $294.1 million and operating EBITDA up 14% to $36.1 million. Net profit increased to $15.7 million, while recurring revenue reached $95 million, or 32.3% of group revenue. Growth was strongest in Mining, supported by demand for Rocklabs equipment and automation. Scott expects FY27 revenue of $310–$340 million, supported by a $146 million forward work pipeline. The key opportunity is rising demand for automation, while project timing and customer capital spending remain risks. Scott declared a 5-cent fully imputed final cash dividend, equivalent to approximately 6.94 cents gross. Share Price Reaction: Scott shares rose 4.7% to $2.90 on 22 October following the result, before easing slightly the next session.
Current Share Price: $2.86, Forecast Dividend Yield: 2.80%.

Skellerup Holdings (NZX: SKL) – Strong Start Supports Further Earnings Growth
Skellerup started FY27 strongly, with first-quarter net profit up 15% on the same period last year. Demand remained solid across its markets, particularly in the Industrial division. Management now expects FY27 net profit of $67–$72 million, implying further growth from FY26. The outlook is supported by broad demand across water, agriculture and industrial applications, although higher costs and geopolitical uncertainty remain risks. Share Price Reaction: Skellerup shares closed unchanged at $7.51 on 21 October, then rose 1.6% to $7.63 the following day.
Current Share Price: $7.60, Consensus Target Price: $7.53, Forecast Dividend Yield: 4.36%.

Genesis Energy (NZX: GNE) – Strong Hydro Conditions Reduce Reliance on Thermal Generation
Genesis reported a positive start to FY27, helped by strong national hydro storage. Thermal generation fell sharply to 163GWh, down 620GWh from the same quarter last year, allowing Genesis to buy more electricity from the market and preserve gas for higher-value customers. Customer numbers increased to 493,450, while the first stage of the Huntly battery was commissioned and the Leeston Solar Farm reached final investment decision. The positive is greater generation flexibility, while earnings remain exposed to rainfall, wholesale electricity prices and gas availability. Share Price Reaction: Genesis shares rose 1.3% to $2.35 on 22 October following the update.
Current Share Price: $2.33, Consensus Target Price: $2.70, Forecast Dividend Yield: 6.56%.

BHP Group (ASX: BHP) – Iron Ore Strong, While Copper Production Temporarily Falls
BHP reported a mixed September quarter. Copper production fell due to lower grades, maintenance, weather disruption and operational issues, while Western Australian iron ore achieved record mine and port performance. Full-year production guidance was maintained. Stronger copper pricing helped offset the weaker production result, while BHP continues to invest in copper and potash growth projects. The long-term opportunity remains rising demand for copper from electrification, grids and data centres, although commodity prices and operational disruptions remain key risks.
Share Price Reaction: BHP shares fell around 1.6% to A$59.50 on 20 October, before weakening further over the following sessions.  
Current Share Price: $55.62, Consensus Target Price: $59.63, Forecast Dividend Yield: 2.64%.

Meta Platforms (NASDAQ: META) – Advertising Remains Strong as AI Spending Surges
Meta reported Q3 revenue of US$64.6 billion, up 26%, supported by strong advertising growth. Ad impressions rose 10% and average ad pricing increased 14%, while daily users across Meta’s apps reached 3.64 billion. However, costs and expenses rose sharply as Meta continued investing heavily in AI infrastructure, alongside a large legal charge. The key opportunity is that AI is already improving advertising performance and could create new products, while the main concern is whether the scale of AI spending will generate sufficient returns. Share Price Reaction: Meta shares fell 7.0% to US$648.85 on 22 October, with investors focusing on rising costs and heavy AI investment.
Current Share Price: $642.62, Consensus Target Price: $841.80, Forecast Dividend Yield: 0.29%.

Tesla (NASDAQ: TSLA) – Record Deliveries but Profitability Under Pressure
Tesla delivered 486,532 vehicles in Q3, while energy-storage deployments reached a record 13.7GWh. Revenue was broadly flat at US$28.05 billion, while automotive revenue fell 3%. Automotive gross margin improved to 18.5%, but net profit remained under pressure as Tesla increased spending on AI, autonomous driving, robotics and new manufacturing capacity. The long-term opportunity extends beyond vehicle sales into autonomy, robotics and energy storage, although these projects require heavy investment while the core vehicle business faces intense competition. Share Price Reaction: Tesla shares fell 3.1% to US$374.58 on 22 October, as investors focused on profitability despite the strong delivery numbers.
Current Share Price: $372.22, Forecast Dividend Yield: 391.58%. 

Spotlight – Election 2026: Which Sectors Could Benefit?

With New Zealand heading to the polls on 7 November, the parties have put forward some quite different ideas for growing the economy. While there are areas of common ground, the election could have implications for particular industries and the companies operating within them.

We have looked beyond National and Labour to see where each party's policies could create opportunities or challenges for investors.

Election 2026 – Party Policy & Sector Outlook 

 Where could the Opportunities Lie? 

What Does This Mean for Investors?

One of the bigger differences is how the parties intend to manage the economy. National and ACT are focused on fiscal restraint and private-sector growth, while Labour and the Greens favour greater government investment and support. The latter could provide a short-term boost, or 'sugar hit', to parts of the economy, although the longer-term impact would depend on how that spending is funded.

Agriculture, healthcare, infrastructure, technology and KiwiSaver are areas where we see support across much of the political spectrum. Mining, property, electricity, supermarkets and banking are more exposed to changes in government policy.

Of course, political support doesn't always translate into stronger company earnings or share prices. Interest rates, global markets and company performance will continue to matter.

We'll revisit the outlook after the election, once we have a clearer idea of which policies are likely to proceed.

For more information and to stay updated subscribe to our newsletter and consult with your Financial Adviser to tailor your investment strategy.

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