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COVID-19 resurgence puts pressure on New Zealand economy, especially dairy sector

12 August 2020

New Zealand stocks registered their worst close in a month on 12 August after the country reported its first cluster of coronavirus cases in over 100 days.

Reuters reports that the coronavirus resurgence drove New Zealand shares lower, with the New Zealand benchmark S&P/NZX 50 index falling 1.3 percent to 1,491.91 at the end of trade. Losses were seen across almost all sectors.

Prime Minister Jacinda Ardern delayed a key step toward next month's general election as the country was plunged into lockdown on discovering its first COVID-19 cases in more than three months.

"The lockdown has come as a big shock to citizens and investors alike... there was a real sense earlier that New Zealand had beaten the virus," said Michael McCarthy, chief market strategist at CMC Markets.

Meanwhile, the Reserve Bank of New Zealand expanded its bond-buying programme and warned that policy rates might have to go below zero to revive its economy.

Among stocks, dairy processor Synlait Milk fell 0.9 percent and utilities company Meridian Energy dropped 2.7 percent.

Read more about this story on Reuters.

Source: Reuters


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