NZX tagged posts

Capital Market Development Paper Released

December 16, 2009 New Zealand FinanceNew Zealand Taxation

Government Building @ WellingtonOn December 16th, the Capital Market Development Taskforce (CMDT) released their final report to the New Zealand Government.

The Taskforce’s paper consists of six groups of recommendations for New Zealand’s capital markets. According to the report, if implemented, the ideas will improve the contribution of capital markets to the country’s economic growth and bring significant fiscal benefits to New Zealanders.

The CMDT has proposed that regulations be established to improve financial advisory services and information available to investors, along with improving investment literacy. Suggestions include replacing investment statements and prospectuses with more standardized disclosure documents. Warnings should be applied to high-risk and complex investments products.

The paper identifies...

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OCR Cut by Another 150 Points

January 29, 2009 New Zealand Finance  No comments

The New Zealand Official Cash Rate has reached the lowest level since its creation.

The January 29th Official Cash Rate (OCR) announcement followed what many already thought would happen, although to a greater degree. The OCR was cut 150 basis points to the lowest level it has ever been at, reaching 3.5%.

Kiwibank and Westpac have already adjusted their one year fixed term home loan interest rates accordingly, but Reserve Bank Governor Alan Bollard urges other banks to do the same and pass the lower rates to customers. The interest rate cut had positive effects on early morning trading on the New Zealand Stock Exchange (NZX). Although falls were seen with the New Zealand dollar falling below 52 cents against the U.S. Dollar.

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Kiwi Rises Against Greenback and Yen in New Year

January 6, 2009 International FinanceInternational TaxationNew Zealand Finance  No comments

An improved tax outlook in the U.S. and best Christmas in record in NZ, sees the New Zealand Dollar (Kiwi) rise against both the U.S. Dollar (Greenback) and the Japanese Yen.

With hopes pending on President Elect Barack Obama’s proposed U.S. Economic stimulus package, American investors are apparently more open to the prospects of higher yield yet higher risk investments. In effect lowering demand for safer currencies like the Japanese Yen and raising that for the likes of the Kiwi. The package prosposes to aid joblessness and relieve tax payers earning below USD$200,000 a tax break of USD$500, or USD$1,000 for couples.

Combined with the highest Christmas season spending on record and positive first weeks of 2009 New Zealand Stock Exchange trading, the Kiwi is seeing positive resurgences...

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New Zealand Stocks Undervalued

October 28, 2008 New Zealand Finance  No comments

According to a report released by Forsyth Barr, stocks traded on the New Zealand Stock Exchange (NZX) are currently trading at a median of 33.2% below their true value.

Even measured via a long run average prior to 2003, the NZX has been trading at a below value median of 8.2%, but this figure took an uncharacteristic sharp turn downwards in late 2007 to reach its current level of 33.2%. The NZX index has fallen over 1000 points since May, 600 of those have been since the post September “Financial Crisis”. It would seem that this trend will continue with the NZX falling further amidst the increased volatility of international markets.

Commenting on the report, Rob Mercer of Forsyth Barr research, said that while current prices are technically very good value for money, he does not expe...

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