OneAnswer KiwiSaver Scheme Australasian Share Fund

The NZX 50 Index rose 5.5% during the quarter, marking its highest level this year. However, it lagged behind several global peers, reflecting persistent economic headwinds and subdued business and consumer confidence.

In August, the Reserve Bank of New Zealand (RBNZ) cut the Official Cash Rate (OCR) by 25 basis points to 3.00%, responding to a series of weaker economic indicators. The economy contracted by 0.9% in the June quarter – its third decline in five quarters – while annual GDP fell 1.1%. Per capita growth dropped 2.8%, with notable weakness in construction and manufacturing.

On a more positive note, inflation remained contained, with the annual Consumer Price Index (CPI) rising 2.7% in the June quarter, still within the central bank’s target range. This supported the RBNZ’s decision to maintain an accommodative monetary stance.

Across the Tasman, the ASX 200 Index ended the quarter up 4.7%, reaching a fresh record high – although the index did end the quarter well off its highs. Its late-quarter struggles came amid worries that inflation pressures may persist.

Having the biggest positive impact on fund performance was its overweight position to Pacific Edge. Its shares nearly doubled over the quarter, driven in part by the news that the Centers for Medicare & Medicaid Services (CMS) recommended a price for its Cxbladder Triage Plus test approximately 30% higher than the initial proposal. It also announced it had received notification from Medicare Administrative Contractor (MAC) Novitas that it intends to convene an expert panel to consider coverage for tests mentioned in the 2025 update to the American Urological Association (AUA) microhematuria guideline, including Cxbladder Triage strongly enhancing the probability of reinclusion.

Other positive contributors included holdings in Vector, Tourism Holdings and Ryman Healthcare, with all three delivering double-digit gains over the quarter. Vector shares were in demand as falling bond yields made higher-yielding companies more attractive on a relative basis. Meanwhile, Tourism Holdings gained 19.6% after rejecting a $2.30 per share acquisition offer from a BCG Capital-led private equity consortium, which represented a significant premium to its prior closing price. And Ryman shares benefited from a slight rebound in sentiment after a tough period for the retirement village operator.

Offsetting some positive fund performance was overweight positions to CSL and Jamies Hardie Industries shares, which saw their shares fall 11.4% and 28.9% respectively. CSL reported disappointing earnings that included a significant restructure plan that will see it spin off its Seqirus business and cut costs by around A$500 million per year. Meanwhile, James Hardie shares fell after the building materials company sharply revised down its full-year earnings expectations amid signs of a housing slowdown in the US.

The fund invests mainly in New Zealand and Australian equities. Investments may include:

• Equities in companies that are listed or intend to list on the New Zealand or Australian stock exchanges
• Cash and cash equivalents.

This chart shows the mix of assets that the fund generally intends to invest in – 100% equities.

See the fund's actual investment mix on page 3 of the fund update.