NZSX50 - Good News!

[skid]

Meagre are you?? Ok I am now channelling Yoda..so bear with me.... If you want to start a thread...how about
NON-Investment strategies, because that's what that leads to. It means you consider withdrawing from mainstream investing and focus instead on protecting what you have. Problem is of course where do you draw the line...banks fail..better withdraw funds and bury gold bars in the back garden, stock markets collapse so you better cash up and ...and....and...what...? Dwelling on and planning for unknown and possibly unlikely scenarios is all well and good if you know when and how. Either you have an optimistic outlook and believe that the basically intelligent animal that we are will find a way through the difficulties, (as we do and have been doing for centuries), or you start gnawing on your fingernails and start looking for the signs of imminent financial disaster. Up to the individual of course however if you feel strongly maybe start a new thread over in the Investment Strategies.

I think you are looking at the world in black and white ,while possibly discarding the multitudes of shades of grey.
There are plenty of places you can draw the line(especially if your optimistic about man being an intelligent animal)--(you have only given him 2 choices --believe or knaw your fingernails--not much faith in his intelligence.
You can still lose your skin on the share market well before banks fail and it comes down to gold bars in the garden.
Who says you always have to be invested?--sometimes you make more by not being invested. By not losing your hard earned dosh (that you have paid tax on )--The worst way to not make money ,is by losing it.
Investors have strategies to exit shares for that very reason--no reason that cant be the case with the market in general. IMHO

[MAC]

Our market at a macro level is synchronised closely with the US markets, has been for a few decades, and that is unlikely to change anytime soon.

The US share markets peak when cyclical US interest rates have peaked and start to fall in response to a turn in the US economy. We have up to a couple of years before that occurs, assuming the US is not in a secular bull cycle now.

http://www.sharetrader.co.nz/showthread.php?9278-Is-This-Bull-Cycle-Over&p=525252#post525252

http://www.harbourasset.co.nz/wp-con...ulus-Final.pdf (http://www.harbourasset.co.nz/wp-content/uploads/2015/05/Harbour-Investment-Horizons-Navigating-the-removal-of-US-Fed-stimulus-Final.pdf)

The NZ50 is an interesting animal NBT, historically the average PE ratio over time is higher than the share markets of other western countries because we have a market dominated by dividend paying stocks, well, even more so now than ever due to the big power company and other IPO’s last year.

When global interest rates are low as they are at present inflows will go into those dividend paying stocks and boost the NZ50.

At present 40% of the NZ50 is offshore held, historically the average is 30%, and much of that holding will be by offshore yield hunters.

When global interest rates start to rise next year some of that cash may exit, however, it will go from the yield stocks, not necessarily all stocks.

At that time, others who were in those yield stocks for the capital gain, particularly local investors, may also take some profits.

With up to a couple of years to run in the bull cycle, the question really is where will that local profit taking go, some will go to cash, some will go into non dividend stocks, there are a few that are relatively undervalued and have been neglected whilst the yield hunt has been full on.

[BlackPeter]

Hi,

Can someone with a better understanding of the macro environment than myself please explain why the following is incorrect or not a problem (or advise if it is correct)...

Situation; the economy is doing reasonably well and shares are becoming fully priced with no major room for large but rational price increases, therefore are unattractive. Typically during these times of a good economy, interest rates will be reasonably high and therefore bond prices low.
We enter a global slowdown (for whatever reason, say Greece for example) and with fully valued shares, people start to bail from shares and would usually invest in bonds as their prices are low and interest rates are about to fall sending their prices up.
However, in NZ we have the fully priced share scenario, but we also have low interest rates and therefore fully prices bonds. We also have fully priced property!

Is this the perfect storm that's going to cause us the next big dramas as investors, or is the macro theory a little more complicated or different to that?

Cheers,

NBT

Very good question - and to a degree we are here in uncharted territory - i.e. I guess the only thing people can do is to speculate what might happen.

You describe correct the typical cycles we have seen so far (and I am just using different words to describe the same thing):

Interest rates are low, Business is lending (cheap) money to make more business, share prices go up and given a limited money supply interest rates go up; People shift their money from (now dear shares) to (cheaper) bonds, business finds it difficult to still make money given high interest rates and therefore business activity drops. Given less demand for money in a high interest rate environment, interest rates drop. Back to square one.

What's different this time is that Central banks around the world created (using QE) a huge amount of additional money (i.e. the money supply is hardly limited anymore). This prevents interest rates from rising (because there is lots of money floating around) resulting in fully valued shares and low interest bonds at the same time.

In my view the only solution is that long-term the amount of money is re-balanced against the world GDP. There are two options: The world can increase the amount of goods and services (without further increasing the money supply) or alternatively the world can either devalue the money (using inflation) or just take money out of the supply chain (using defaults or so called haircuts, where debtors are not fully repaid).

At this stage it looks like defaults / haircuts seem to be the method of choice to remove some of the surplus money out of the supply chain (remember Russia, Argentina, Cyprus, Greece) - but obviously you never know what the future will bring.

[Joshuatree]

Only 2 stocks in the green this morn on the whole NZX but 19 by the end. Good recoveries in the mkts today
Shanghai bourse up re 5.7%
DOW implied open up re 170

[Hoop]

I had a person tell me there's no time like the present to invest in shares..The economy is strong and going forward with the lower NZ$ the economy will keep strong...
So after reading Warren Buffett books and armed with the life savings at retirement that person is going to enter the market for the first time and buy Blue Chip stocks with large yield rates using a long term buy and hold strategy... I told him as with all investment disciplines timing is the most important factor...

At the moment the time doesn't seem right..Try picking a mature bull market cycle investment strategy instead...

http://i458.photobucket.com/albums/qq306/Hoop_1/NZX50%2008072015L_1.png (http://s458.photobucket.com/user/Hoop_1/media/NZX50%2008072015L_1.png.html)

[couta1]

Gee Hoop that guy sounds kinda like me, he will sure have a rollercoaster ride and a lot of fun at the same time but I sure hope he's got huge gonads as well:cool:

[Onion]

Which companies are in the NZX50? Is it a secret now?

I have been looking a some Google Sheets spreadsheets of mine that pull in data from Yahoo. It has been some time since I adjusted them to recognise the current constituents of the NZX50, NZX20, NZAX, etc.

So naturally I went to NZX.com (https://nzx.com/markets/NZSX/indices/NZ50) to see which companies are currently in the NZX50. I was surprised to see that, since NZX outsourced the management of the index to S&P Dow Jones Indices, there is no list of the companies in the top 50 index!

There is a nice link to http://us.spindices.com/indices/equity/sp-nzx-50-index
... but that only shows the top 10 by weight!

Further, their (S&P) FAQ states:

The lists of index components are not available to the public; they are only provided to index subscribers or by special request.

[sb9]

Trading numbers so far on NZX today...

Daily Value Traded

NZSX
$2,074,673,595


NXT
$0


NZAX
$30,807

[OldRider]

Onion:

Will this give what you want? It does not have a date
so may be no longer current. I haven't checked it
https://nz.finance.yahoo.com/q/cp?s=%5ENZ50

[Kaspar]

Which companies are in the NZX50? Is it a secret now?

I have been looking a some Google Sheets spreadsheets of mine that pull in data from Yahoo. It has been some time since I adjusted them to recognise the current constituents of the NZX50, NZX20, NZAX, etc.

So naturally I went to NZX.com (https://nzx.com/markets/NZSX/indices/NZ50) to see which companies are currently in the NZX50. I was surprised to see that, since NZX outsourced the management of the index to S&P Dow Jones Indices, there is no list of the companies in the top 50 index!

There is a nice link to http://us.spindices.com/indices/equity/sp-nzx-50-index
... but that only shows the top 10 by weight!

Further, their (S&P) FAQ states:

Yeah i noticed this a few weeks ago, irritating right?

[Onion]

Onion:

Will this give what you want? It does not have a date
so may be no longer current. I haven't checked it
https://nz.finance.yahoo.com/q/cp?s=%5ENZ50

Thanks OldRider.

That link certainly lists 50 stocks; probably the constituents of the NZX50. The thing is, what would you check it against? It seems you can't check it against anything that NZX or S&P provide!

I haven't found any equivalent list for the3 NZX20, NZX10, etc.

[winner69]

What you actually after onion?

[Onion]

Yeah i noticed this a few weeks ago, irritating right?

I am quite puzzled by it. I had thought that there would be an obvious, public, list; that periodically companies would move in and out of the top 50 (10, 20, etc.); and that I would be able to see the constituents -- i.e. like I use to be able to do on the NZX site.

[Onion]

What you actually after onion?

I have is a spreadsheet of all the NZX companies. It contains columns to mark a company as a participant in the NZX50 index, the NZX20 index, the NZX10, NZX SmallCap and NZX MidCap indexes.

Of much use? I don't really know; but that is what I have.

I refreshed my spreadsheet and thought I ought to refresh my "index" columns (I like things to be tidy!). Not so simple because there seems to be nowhere that lists the index participants.

My empty columns are glaring at me! :mad ;:

[Rossimarnz]

I was looking for similar information yesterday and found it very frustrating. I was trying to find which companies were on the verge of entering the NZX 50. Had a particular interest in SCL and THL and what their chances of entering were.

[Onion]

I was trying to find which companies were on the verge of entering the NZX 50.

That is what I might use my spreadsheet columns for! I knew there would be a purpose. :)

I have my NZX50 column filled now thanks to the link that OldRider found.

[blackcap]

Just check up what constitutes FNZ (top 50 index fund run by NZX ironically) and that will tell you who is in and out. They have to publish in prospectus the full list so if the NZX wants to keep it a secret (which they do) then they have shot themselves in the foot inadvertently.

[Bilbo]

Just check up what constitutes FNZ (top 50 index fund run by NZX ironically) and that will tell you who is in and out. They have to publish in prospectus the full list so if the NZX wants to keep it a secret (which they do) then they have shot themselves in the foot inadvertently.

ANZ Securities show a list of companies called the NZX 50 Index under the NZ/AU Markets menu. I would assume ABB Securities also do the same. I assume that list is current. If you don't use an online broker I'm expect your broker could provide the list.

[whirly]

Funny I had the same thing introducing my son to the sharemarket today and looked a real dork when I couldn't even find a list of the top 50 on NZX.

[blackcap]

ANZ Securities show a list of companies called the NZX 50 Index under the NZ/AU Markets menu. I would assume ABB Securities also do the same. I assume that list is current. If you don't use an online broker I'm expect your broker could provide the list.

Cheers Bilbo, that is correct. Interesting though, as I called the NZX not too long ago and I asked them the 2 companies at 49 and 50 and they said I would have to pay for the information. They do not like releasing their constituent companies and do try and get subscribers to pay for the privilege. Thanks to ANZ, ASB, FNZ et al if we have some nous we can work it out for ourselves.

[Onion]

if we have some nous we can work it out for ourselves.

At least that is true for the NZX50. I haven't found any sources for the other minor NZX indexes that the S&P maintain:

S&P/NZX 50
S&P/NZX 20
S&P/NZX 15
S&P/NZX 50 PORTFOLIO
S&P/NZX SCITECH
S&P/NZX 10
S&P/NZX MIDCAP
S&P/NZX SMALLCAP
S&P/NZX ALL
S&P/NZAX ALL
S&P/NZX MORRISON

NZX still reveal the constiuents of other indexes:

PRIMARY
ENERGY
GOODS
PROPERTY
SERVICES
INVESTMENT

[Xerof]

But how do you adjust for the free float % these days? What might look like number 50 on raw MC data, might be number 40

I think our new contributor probably knows SCL and THC are next cabs off the rank

[Rossimarnz]

But how do you adjust for the free float % these days? What might look like number 50 on raw MC data, might be number 40

I think our new contributor probably knows SCL and THC are next cabs off the rank

Hi Xerof - I know nothing although I am interested in finding out. I am a genuine newbie to this site and also to the market (invested about 6 months ago). I think a number of people on this site have already prophesised that SCL will be included. I wonder too whether THL is a candidate although perhaps over a slightly longer timeframe than SCL.

Disclosure - own SCL (recently topped up) and recently purchased THL

[smpl]

You should use Bloomberg to get the current constituent list.

Historical data is actually quite difficult to attain. I use the CRSP database at WRDS for replicating individual component's contribution to index performance through time.

[BlackPeter]

You should use Bloomberg to get the current constituent list.

Historical data is actually quite difficult to attain. I use the CRSP database at WRDS for replicating individual component's contribution to index performance through time.

Not sure what the problem is to find the NZX50 companies?
Try this: https://www.anzsecurities.co.nz/directtrade/dynamic/index.aspx?id=NZ50&e=NZSE&view=security

[Hoop]

Not sure what the problem is to find the NZX50 companies?
Try this: https://www.anzsecurities.co.nz/directtrade/dynamic/index.aspx?id=NZ50&e=NZSE&view=security

I can't see that problem..maybe the world has changed and share investors don't look at share prices anymore;)

Want to track overall NZX PE Ratio and Dividend yield thread (http://www.sharetrader.co.nz/showthread.php?9208-Want-to-track-overall-NZX-PE-ratio-and-dividend-yield) is an interesting ST thread....I use Jamiec26 Google speadsheet NZ listed companies (automatically updates) ..unfortunately at the moment my Firefox browser is throwing a hissy fit at the spreadsheet.

Jamiec26 post got me inspired to create my own Google spreadsheet with hyperlinking to Google finance which has a wealth of NZ company info and its free.

The thread also has other interesting links for bookmarking.

[nextbigthing]

Does anybody have a good link to a calendar etc with all the upcoming results announcement dates on it?

[Hoop]

Does anybody have a good link to a calendar etc with all the upcoming results announcement dates on it?

NBT...Try here on the NZX website (https://www.nzx.com/markets/NZSX)

[nextbigthing]

NBT...
Try here on the NZX website (https://www.nzx.com/markets/NZSX)

Not 100% what I'm after but will do for now. Thanks Hoop.

[blackcap]

Here is a good one for Australia.... do not know if there is a comparable one for NZ. Do not think so....

http://www.morningstar.com.au/Stocks/CorpCalendar

[nextbigthing]

Here is a good one for Australia.... do not know if there is a comparable one for NZ. Do not think so....

http://www.morningstar.com.au/Stocks/CorpCalendar

Thanks Blackcap, that's a good one, but yeah after the NZ version.

[nextbigthing]

So who's having fun out there at the moment? Enjoying those red arrows? Wonder if all the people who moved to cash will be tempted by the low prices when it turns around again

[couta1]

So who's having fun out there at the moment? Enjoying those red arrows? Wonder if all the people who moved to cash will be tempted by the low prices when it turns around again
I've had lots of red arrows for a long time now its just they have increased in size of late but its not fun or enjoyment, more patience/perseverance and long suffering. PS- Wouldn't it feel good to have a big cash pile to go on a spending spree right now.

[see weed]

I've had lots of red arrows for a long time now its just they have increased in size of late but its not fun or enjoyment, more patience/perseverance and long suffering. PS- Wouldn't it feel good to have a big cash pile to go on a spending spree right now.
What would you buy?

[couta1]

What would you buy?
I'd buy some or some more of the following Xro/Sml/PGW/MRP and Spk.

[Joshuatree]

50DMA gone under for re the fifth time (1 year chartNZX) and nearly down to 200DMA for the first time. Same on NZX All.

[Baa_Baa]

50DMA gone under for re the fifth time (1 year chartNZX) and nearly down to 200DMA for the first time. Same on NZX All.

Seems like a sucker rally sold into by the smart money? Lots of stocks down hard into the close, even after regathering from the open and into the morning. Will pour over the charts tomorrow.

[nextbigthing]

Looks like something between a 'healthy correction' and a crash is becoming a self fulfilling prophesy.

[Hoop]

Looks like something between a 'healthy correction' and a crash is becoming a self fulfilling prophesy.
Without firing up the old chestnut debate about TA and self-fulfilling prophesy argument...Oops, sorry, too late:)...Let me clarify..

Most important for everyone to understand before reading this post...The equity market is an leading indicator ..the consumer market is a lagging indicator (trickle down effect)...Therefore realise the psychological behaviour of a consumer who never had it so good..would obviously disbelieve Mr Market when the the Stockmarket turns down ..and the reaction to this disbelief a defense mechanism would be to apportion blame to something they don't like (fear) or understand..the whipping boy is usually TA.
Failure to understand that TA is a messenger..Ok and welcomed when the message is good news but when the messenger brings bad news it is often not wanted and sometimes its met with a hostile reception.. nothing worse seeing a partypooper..eh?

Also what many investors fail to see is the "chicken and the egg" scenario as TA reports the change after every changing event not before it..TA is not a predictor as it can't obtain data that it needs from a future which hasn't yet happened

So,.. can TA have a self fulfilling prophesy effect and when does it occur?.....

Yes..All the time because the sharemarket functions as a Market place which quickly reacts to all news or trading behaviour at the time of happening ..The effect is especially noticed with minute/hourly/day.. nano/mini-cycles where those traders or sophisticated computer stop/loss programs are dominate....

The self fulfilling prophecy effects wane as time marches on, such as, investor reactions causing short/medium term events deemed as healthy bull (or unhealthy bear) market corrections or on a rare occasions flash crashes, are noticeable but the frequency of occurances are less.

Over time there is a point when self fulfilling prophecy (SFP) effect scenarios becomes nonsense and stuff of fairy tales, as in the much longer cycle scenarios such as long term cyclic bull and bear market cycles**........and from nonsense to totally ridiculous when blaming SFP it to secular cycle effect which can be generational (15 + years long).... In these cases the market reacts early to a "predicted" future fundamental decline and when that decline become realty The fundamental effect fails to balance (see Yin Yang below)

Why can't we apportion blame of a crash to SFP?.... Because the "Yin and Yang balancing" effect is far to strong.. (FA counterbalancing the TA effect) kicks in reasonably quickly, extinguishing any possible trigger effect spreading into the long term and taking hold....At some point in "quick time" Mr Market sees fundamental reality over perception..If reality is still good and the perception proved to being a doom mirage then Fundamental effects will counter -balance to restore equity to the system. If realty proves to be the same as the perception..then the fundamental effect won't kick in as equity in the system has already occurred

**A possible exception is the SFP effect near to tops and bottoms of cyclic bull/bear cycles when the longer irrational periods of greed/panic can occur..

Quote...The market can stay irrational longer than you can stay solvent.......John Maynard Keynes (http://www.quotationspage.com/quotes/John_Maynard_Keynes/),

[Beagle]

John Key suggesting that the economy is still in good shape despite the steep collapse in the dairy price...Yeah right, hand me another Tui...oh wait, even Tui are laying off workers.
http://103.14.3.1/news/election-2008/281380/tui-brewery-to-cut-24-staff

[Hoop]

John Key suggesting that the economy is still in good shape despite the steep collapse in the dairy price...Yeah right, hand me another Tui...oh wait, even Tui are laying off workers.
http://103.14.3.1/news/election-2008/281380/tui-brewery-to-cut-24-staff

He may still believe in Self fulfilling prophecies..Roger...so let us all spread the word..all's good....... did that work?... Ah ha..Did you see that rockstar..I did I saw a Rock Star lets spread the word ...good times are here again.....

hmmm ......I think I've forgotten to take my pills

[Beagle]

Yeah mate. Shares hit seven month low on Friday speaks for itself. If the economy is a rock star it has missing teeth and this cycle is older than Mick Jagger !! But John would have us taking happy pills and turn up the music regardless lol

Rather telling that the total for all stocks for the year in the ST competition is -3% for the year to date isn't it !! I presume that includes dividends, ouch !! Be careful out there folks, this could be a bear with claws :scared:

[noodles]

Of the 50 stocks on the NZX50 (funny that), 25 are above the 200D EMA. 25 are below.

Things seems to be in the balance.

It also appears to have diverged (to the downside) when compared to the S&P500.

[bull....]

back to the bottom of the trading range again 5700 - 5900 approx. been in this range since march, reminds me of some overseas markets sometimes be interesting what happens next week.

actually all markets have been hammered this mth apart from china and us utilities and treasurys - is this trying to tell us something

[Baa_Baa]

NZX50 Capital daily chart log scale, Friday open and close below the 200EMA. The upper candle shadow shows the morning rally on Friday followed by the sell down. I think the last break and close below the 200EMA was July 2012. The NZX50 Gross is still above the 200EMA

Anyone care to verify? I'm not sure if this dataset is valid.
7519

[winner69]

some would say looking very much like late 2007

https://au.finance.yahoo.com/q/ta?s=%5ENZ50&t=my&l=on&z=l&q=c&p=e200&a=&c=

The 2010 and the 2012 breach baabaa mentioned didn't do much damage - it still kept going up

[BlackPeter]

I am no chartist ... but so far it does not look like the end of the world to me. Still in the upward channel - bounce and nice upturn ahead?

7522

As well - wasn't 2007 a Global Financial Crisis? The rest of the world doesn't look that bleak to me ...

But hey - I guess soon we will know ...

[Baa_Baa]

Anyone know what happened at 3pm Friday that might have set off this sell down into the close? Surely not just the breakdown of the NZX50 Capital 200EMA?
7523

[couta1]

Anyone know what happened at 3pm Friday that might have set off this sell down into the close? Surely not just the breakdown of the NZX50 Capital 200EMA?
7523Index rebalancing by the big boys apparently.

[Hoop]

Index rebalancing by the big boys apparently.

Thx Couta....I was wondering about that...

I see all bids and asks are gone from all NZX depth data ...So I guess that prevents automatic triggers firing off first thing Monday morning ...Am I correct in saying that???

[noodles]

Index rebalancing by the big boys apparently.
Not much of a rebalance if all they were doing was selling. Lets see if the trend is reversed on Monday.

[winner69]

Not much of a rebalance if all they were doing was selling. Lets see if the trend is reversed on Monday.

Had to do with all the extra Contact shares out there - funds rebalancing portfolios by selling others to keep the weightings in order

[noodles]

Had to do with all the extra Contact shares out there - funds rebalancing portfolios by selling others to keep the weightings in order
Thanks....

[Xerof]

Had to do with all the extra Contact shares out there - funds rebalancing portfolios by selling others to keep the weightings in orderyeah, thats the correct answer Winner. Unfortunately, our financial press reporters won't write it up as such. But at least some of the ill-informed comments on the various trolled threads can be seen for what they are eh?:t_down:

[Hoop]

We are being bombarded by many on ST that some of us are unnecessarily negative as we are being told that our economy is still good and the future looks bright....
Think rockstar..spread the good word and bugger the world..

OK.. the good word is this NZX50 chart is one of the better index charts in the world at the moment.....is spreading this good word working...warm fuzzies from everyone...eh?
Same goes for the Nikkei and Sensex...The logic must be they're spreading the good word too...Hallelujah

The Aussis the Americans the British the Europeans the Singaporeans the Chinese don't know how so they maybe started that travel to hell in a handcart..
....and tonight in Europe that trip to hell is continuing to look likely..

The NZX50 chart below is simple, although we just had a record high if the NZX50 index breaks that 5695 bull/bear support we could be going to hell with them

http://i458.photobucket.com/albums/qq306/Hoop_1/NZX50%2020082015.png (http://s458.photobucket.com/user/Hoop_1/media/NZX50%2020082015.png.html)

[sb9]

I think solid reporting season keeping the NZX afloat at the moment or else could've been watershed...look at other markets, bit scary really.

[Hoop]

I think solid reporting season keeping the NZX afloat at the moment or else could've been watershed...look at other markets, bit scary really.
Yeah..could be sb9 . I hope so.......

The NZX50 been rather insular ......I must admit that type of behaviour gives me the willies

[Hectorplains]

Yeah..could be sb9 . I hope so.......

The NZX50 been rather insular ......I must admit that type of behaviour gives me the willies

http://news.yahoo.com/us-stocks-lower-morning-trade-global-markets-fall-155312751.html

Could be one of 'those' Fridays - looks like at least 1+ % dip is likely today.

[bull....]

I think what is happening in overseas markets has more to do with falling oil and commodities causing people to sell those sectors and a bit of fear in regards to china - in nz we don't have any representation of those commodity sectors.

In fact in the us the utilities and treasuries have performed really well so saying the markets as a whole are crashing is really not correct. in nz we have good representation in those sectors

so explains why nz is holding up. doesn't mean some people wont naturally panic lol

[James108]

I would love a nice big stock market crash (as long as I keep my job). Who doesn't like buying things when they are cheap?

[Hoop]

I would love a nice big stock market crash (as long as I keep my job). Who doesn't like buying things when they are cheap?

Luckily..stock market crashes are very rare events ..they always catch everyone by surprise (black Swan event)... therefore they are very capital destructive and only a few people are able to take advantage of the "cheap" prices....as money has disappeared.

It could be fun though..I would love to see the look on the Bank Managers face on that week of the crash when you stroll in and ask for a loan to buy more shares:D

[BobbyMorocco]

So the NZX50 appears to be holding up pretty well today. Pretty much no change from yesterday, and up for the week, while most of the other world markets are all down quite a considerable amount today and this week.

Does this mean NZ is going to be a bit of a safe haven and more overseas investors are going to park their money here due to the strength of our market or are we only holding up due to the impressive reports that have been coming out recently and once the euphoria of these reports wears off is the NZX50 likely to get tarred with the same brush?

Any thoughts and opinions anyone may have will be appreciated.

[kiora]

So the NZX50 appears to be holding up pretty well today. Pretty much no change from yesterday, and up for the week, while most of the other world markets are all down quite a considerable amount today and this week.

Does this mean NZ is going to be a bit of a safe haven and more overseas investors are going to park their money here due to the strength of our market or are we only holding up due to the impressive reports that have been coming out recently and once the euphoria of these reports wears off is the NZX50 likely to get tarred with the same brush?

Any thoughts and opinions anyone may have will be appreciated.

NZ sharemarket does well when the farming industry is in the crap.Check the correlation :)

[Major von Tempsky]

Well Spark is holding up nicely today and doesn't have any exposure to overseas. And the milk products auction rose. And National got a decent poll from Roy Morgan. And the US, the largest economy in the world is growing solidly, and some of the European ones incl the UK and Germany.

There's always some nutters ready to call another Great Depression and sell a few books on the strength of them. Literary history since WW2 is littered with them.

But there could always be a mindless NZ panic tomorrow because it's de rigueur overseas...

[Sgt Pepper]

Well Spark is holding up nicely today and doesn't have any exposure to overseas. And the milk products auction rose. And National got a decent poll from Roy Morgan. And the US, the largest economy in the world is growing solidly, and some of the European ones incl the UK and Germany.

There's always some nutters ready to call another Great Depression and sell a few books on the strength of them. Literary history since WW2 is littered with them.

But there could always be a mindless NZ panic tomorrow because it's de rigueur overseas...

Is the Telegraph,(Conservative supporting) paper also amongst "some nutter"s?? It listed its very real concerns as1 –
1_China slowdown
2 – Commodity collapse
3 – Resource sector credit crisis
4 – Dominoes begin to fall
5 – Credit markets roll over
6 – Interest rate shock
7 – Bull market third longest on record
8 – Overvalued US market

[BobbyMorocco]

There's always going to be some that think all is rosy and there's going to be others that think it's all doom and gloom. I don't have the luxury to call upon experience to help me figure out if we are at the market top and about to go through a correction (I began investing in the sharemarket early 2013, so all's been well so far). Some indicators suggest that yes, we have reached the top and it's all downhill from here, others suggest we may not be at the top yet and have some left to run. No doubt the correction for the NZX50 will come, but I wonder is it going to come right now?

[Major von Tempsky]

I'm just talking about the NZ scene....you may recall we missed the Asian crisis of the 90s and the Dot.com collapse....

I would say The Telgraph article is spotty and vague - there are some commodities which haven't collapsed e.g. beef and some other farm products, nickel for nickel-ion batteries and I'm sure some people could reel off a whole heap more.

It's journalese rather than economic analysis e.g. "dominoes begin to collapse" is he/she talking about South-East Asia under Communist assault in the 60s and 70's?

"Credit markets roll over" well they do when term is up and refinancing takes place.

"Interest rate shock"? What the shock of being so low? The US is the only place considering an interest rate rise and that now seems less likely if you read around.

"Bull market market third longest on record" in New Zealand!??

"Overvalued US market". About 15? years ago you could wake up, look at what the Dow did last night and know roughly what would happen on the NZ market. Those days are well and truly gone, the NZ market was even totally out of sync with the Australian market today.

I only invest in NZ, the tax complications of investing overseas are too bothersome. So unless the price of copper collapsing because of shorting is going to adversely affect NZ you are shouting Wolf! in the wrong direction.

[Sgt Pepper]

Oh no Major, another Leftie concerned about the world economy. Hang on, that's no Leftie Its Rupert Murdoch

te (?subject=Rupert%20Murdoch%20tweets%20warnings%20o f%20global%20financial%20crisis&body=Check out this story I found on 9news.com.au http://www.9news.com.au/world/2015/08/21/13/16/murdoch-warns-of-global-crisis-in-tweets)A (javascript:void(0);)P (https://www.pinterest.com/pin/create/button/?url=http%3A%2F%2Fwww.9news.com.au%2Fworld%2F2015% 2F08%2F21%2F13%2F16%2Fmurdoch-warns-of-global-crisis-in-tweets&media=http%3A%2F%2Fprod.static9.net.au%2F_%2Fmedia %2Fnetwork%2Fhome%2Fstreams%2F2015%2F04%2F15%2F15% 2F33%2F150415_rupertmurdoch_sb.ashx&description=Rupert+Murdoch+has+warned+the+health+o f+the+global+economy+is+in+such+a+perilous+state+t hat+there+is+potential+for+yet+another+global+fina ncial+crisis.)G (https://plus.google.com/share?url=http%3A%2F%2Fwww.9news.com.au%2Fworld%2F 2015%2F08%2F21%2F13%2F16%2Fmurdoch-warns-of-global-crisis-in-tweets&hl=en_GB)d (https://www.linkedin.com/shareArticle?#url=http%3A%2F%2Fwww.9news.com.au%2F world%2F2015%2F08%2F21%2F13%2F16%2Fmurdoch-warns-of-global-crisis-in-tweets&mini=true&title=Rupert+Murdoch+tweets+warnings+of+global+fin ancial+crisis&summary=Rupert+Murdoch+has+warned+the+health+of+th e+global+economy+is+in+such+a+perilous+state+that+ there+is+potential+for+yet+another+global+financia l+crisis.)


Rupert Murdoch has warned the health of the global economy is in such a perilous state that there is potential for yet another global financial crisis.
The billionaire media magnate took to Twitter to voice his concern about the situation facing markets and how some central banks would struggle to bounce back if things worsened.
"All prices dropping not just shares. Timely correction or sign of major global crisis in near future?" the 84-year-old businessman wrote


Read more at http://www.9news.com.au/world/2015/08/21/13/16/murdoch-warns-of-global-crisis-in-tweets#9OBQY5HtsfBfev8y.99

[percy]

Luckily..stock market crashes are very rare events ..they always catch everyone by surprise (black Swan event)... therefore they are very capital destructive and only a few people are able to take advantage of the "cheap" prices....as money has disappeared.

It could be fun though..I would love to see the look on the Bank Managers face on that week of the crash when you stroll in and ask for a loan to buy more shares:D

Particularly if they are shares in his bank.!!! lol.

[Sgt Pepper]

Particularly if they are shares in his bank.!!! lol.

I wonder what Heartland bank WOULD say to a customer whose stated aim when borrowing money would be to invest in Heartland??

[Sgt Pepper]

Particularly if they are shares in his bank.!!! lol.

I wonder what Heartland bank WOULD say to a customer whose stated aim when borrowing money would be to invest in Heartland??

[Joshuatree]

There's always going to be some that think all is rosy and there's going to be others that think it's all doom and gloom. I don't have the luxury to call upon experience to help me figure out if we are at the market top and about to go through a correction (I began investing in the sharemarket early 2013, so all's been well so far). Some indicators suggest that yes, we have reached the top and it's all downhill from here, others suggest we may not be at the top yet and have some left to run. No doubt the correction for the NZX50 will come, but I wonder is it going to come right now?

Sure is a conundrum Bobby ; I'm scratching my head.Looks like another bath tonight on USA mkts. I have number of NZ stocks that have been fab and many are cum div; something is telling me not to wait for the divs (look at HNZ s/p stalling)and reduce weightings now to get some more cash out as a precaution as I've had a stellar run with them. It seems the US(despite the drops) and UK are the best of the rest of the global mkts and the rest are unwinding faster. Worth reading KW's posts' no doubt there. Goodluck.

[percy]

We live in interesting times.?!
I checked the charts of most of my NZ stocks last night.
Looking very strong;AIA,AIR,CVT,,EBO,FPH,SCL,SEK,SUM,TIL. total 9.
Undecided;AWK,HNZ,MEL,RYM,SKL..................... ................ total 5.
Shocking;IQE...................................... ................................. total 1. .
At this stage all look to be on modest ratios,and are paying good dividends,and have the capacity to increase them.
All have strong balance sheets.I also hold unlisted companies, which again are a mixture of the good,bad and the ugly!
Defensive ,diversified,aggressive stocks.
"Well positioned"???.."Poised"????....

[sb9]

Will be interesting to see how NZX hold up come Monday on the back of carnage happened on global markets overnight. Some players might see our market as safe haven in the short term at least?

[Nasi Goreng]

It amazed me yesterday that XRO, ATM and PEB were all pretty much flat for the day.

It's almost like The NZ share market was asleep. You have to consider the price of investing in NZ vs other markets. In the last 48 hours, global shares are a lot cheaper and comparatively, NZ got a whole lot more expensive.

[Xerof]

the overseas moves are too great to ignore, we can't escape damage come Monday. People take profits to cover losses elsewhere

the herd will react

so long and thanks for all the fish

look to buy about Wednesday.....

[bull....]

Security Name
Close
1 Day
3 Day
5 Day
10 Day
20 Day
30 Day


.DJI
16459
-3.1254
-6.0077
-5.827
-5.2631
-6.3154
-7.3276


.djt
7872
-2.7187
-5.8486
-5.3698
-4.5916
-2.4846
-4.0193


.dju
597
-1.1589
-1.3663
-1.2064
1.1093
6.0881
4.5607


^gspc
1970.89
-3.1851
-5.969
-5.7685
-5.1348
-5.2297
-5.0915


^ixic
4706.04
-3.5151
-6.9769
-6.7785
-6.6918
-7.5185
-5.8358


AUSTRALIA
5214.6
-1.3992
-1.667
-2.6498
-4.7523
-6.3151
-5.0516


BRAZIL
45719.64
-1.9927
-3.6467
-3.7643
-5.8821
-7.1607
-13.0657


CHINA
3507
-4.2849
-6.4301
-11.3175
-4.2206
-14.9596
-5.4546


FRANCE
4630.99
-3.1893
-6.8399
-6.5668
-10.1607
-8.4307
-5.5492


GERMANY
10124.52
-2.9492
-7.2421
-7.8344
-11.8904
-10.7771
-10.5262


HANG SENG
22409.62
-1.5285
-4.5343
-6.5917
-8.7276
-10.8199
-10.0062


INDIA
27831
-0.1686
1.0217
-0.1259
-0.8583
-1.246
-1.2093


JAPAN
19435.83
-2.9809
-5.4402
-5.2809
-6.2184
-5.3966
-2.1136


LONDON
6187.65
-2.8305
-5.1846
-5.5427
-7.9012
-5.9601
-7.2786


NEW ZEALAND
5751.19
0.152
0.7214
0.9609
-2.0017
-2.426
0.4515


Russel
1156.79
-1.3416
-4.7125
-4.6096
-4.152
-5.6444
-7.6061






















the 2 best indices as highlighted nz and dow jones utilities over the last week to mth


even after last night drop utilities were down 1% compared to 3% on other indices


so if you have a diversified portfolio guess you wont be panicked will you?

[Joshuatree]

Nah too late to panic after last nites drop:scared::lol::cursing::D

[ratkin]

just see DOW lost over 500 that cant have happened often before. Better start doing some research on some likely beat ups. Been waiting a long time for a good correction, all cashed up and ready to go when time is right

[pierre]

[QUOTE=bull....;

so if you have a diversified portfolio guess you wont be panicked will you?QUOTE]

No panic here - my diversified NZX portfolio (20 companies) increased in value by $10k yesterday. Not so sure the result will be the same on Monday though - almost certain to be some US contagion.

[nextbigthing]

At this stage all look to be on modest ratios,and are paying good dividends,and have the capacity to increase them.
All have strong balance sheets.

Agree, NZ companies generally are doing ok. If there's no changes to earnings etc then in theory there's no need to panic.


the overseas moves are too great to ignore, we can't escape damage come Monday. People take profits to cover losses elsewhere


Quite right. The interesting thing here being that international diversification is actually causing us a problem when there shouldn't be one, instead of helping. Weird huh.

If buying a share is buying future earnings and if those earnings are stable but the shareprice is discounted because of some events overseas, then surely that's time to buy buy buy...

[couta1]

Relax all that money looking for a nice place to park and where better than stable, excellent divvy paying NZ companies. PS- Xerof I don't think Wed will be a good day to buy Air shares unless you want to pay a lot more for them:cool:

[flying]

I am not as experienced in share trading as some people on this forum and bow to some of the technical analysis shown by the likes of Hoop. All depressions which is the likely response from the events that are being played out at this moment need either a trigger- the Cuban missile episode is an example or a CENTRAL bank decision that goes against common sense. The possibility or probability of the raising of the interest rates by the largest central bank the Reserve Bank of America is the case in point. In 1927 they did just that to 5% and this was the main trigger for the subsequent depression. They also prolonged the depression by raising the rate again in 1937 only WW2 pulled the US out. This one is hanging on the cliff as the Federal Reserve who in my view created this bull run only care about two things the Americian job data which has risen above their threshold and the inflation rate. The trigger in my view will be if common sense prevails by the speech by the president J Laker on the 29th of this month on the inflation rate and the subsequent decision on the Feds rate hike at the September meeting. PS It is interesting that NZs M/A 200 line has not been breached, maybe this is because the NZ economy is one of the few that are relatively free of government interference??

[janner]

Another huge explosion in China.

This could help the Aussie mining industry via the rebuild of factories.

[Hectorplains]

Another huge explosion in China.

This could help the Aussie mining industry via the rebuild of factories.

Yikes a bit soon, eh. :(

[bull....]

in case the panic merchants are out in the morning my shopping list
includes nz utilities for the divs
spark for its div and nz only focus and any other companies with a nz only focus offering divs and value
portfolio sitting on 30% cash so ready to roll rest of the portfolio is income and value - growth went out 2 mths ago when things looked a bit dodgy

[IAK]

Been sitting on 60% cash for the last few months now waiting for a decent correction. AIA, EBO, FPH top of my shopping list.

[Hoop]

Been sitting on 60% cash for the last few months now waiting for a decent correction. AIA, EBO, FPH top of my shopping list.
A correction..yes assuming the 6.5 year old Bull market cycle is still operating...and that could be the million dollar question for some folk.

At the moment (Friday close) the NZX50 is still in a Bull market cycle in a 6 month pause mode (near rectangle pattern) near its Early August top (record high)...

In technical terms this shouldn't be a worry (an uptrend pause (breather) is normally a bullish scenario) but due this extended pause the 5700 support, MA200 and NZX50 index itself are closing in together is creating increasing risk.. then we have overseas equity market bear signs creeping in adding more risk.

So why jump into an old bull market at a time of uncertainty....Many folk on ST forum seem to lack patience and climb aboard at a hint of weakness (or seduced by the good Divvys) with the assumption this NZ market is going to continue upward as it always has...This is one type of Russian Roulette investing I don't do at this mature stage of the Bull market cycle.

Each to their own...

[axe]

Good points KW. How will NZX perform on monday. It could go either way. There could be a ton of $$$ hunting for a "safe haven" or there could be a very sharp selloff.

[Major von Tempsky]

Oh no Major, another Leftie concerned about the world economy. Hang on, that's no Leftie Its Rupert Murdoch

te (?subject=Rupert%20Murdoch%20tweets%20warnings%20o f%20global%20financial%20crisis&body=Check out this story I found on 9news.com.au http://www.9news.com.au/world/2015/08/21/13/16/murdoch-warns-of-global-crisis-in-tweets)A (javascript:void(0);)P (https://www.pinterest.com/pin/create/button/?url=http%3A%2F%2Fwww.9news.com.au%2Fworld%2F2015% 2F08%2F21%2F13%2F16%2Fmurdoch-warns-of-global-crisis-in-tweets&media=http%3A%2F%2Fprod.static9.net.au%2F_%2Fmedia %2Fnetwork%2Fhome%2Fstreams%2F2015%2F04%2F15%2F15% 2F33%2F150415_rupertmurdoch_sb.ashx&description=Rupert+Murdoch+has+warned+the+health+o f+the+global+economy+is+in+such+a+perilous+state+t hat+there+is+potential+for+yet+another+global+fina ncial+crisis.)G (https://plus.google.com/share?url=http%3A%2F%2Fwww.9news.com.au%2Fworld%2F 2015%2F08%2F21%2F13%2F16%2Fmurdoch-warns-of-global-crisis-in-tweets&hl=en_GB)d (https://www.linkedin.com/shareArticle?#url=http%3A%2F%2Fwww.9news.com.au%2F world%2F2015%2F08%2F21%2F13%2F16%2Fmurdoch-warns-of-global-crisis-in-tweets&mini=true&title=Rupert+Murdoch+tweets+warnings+of+global+fin ancial+crisis&summary=Rupert+Murdoch+has+warned+the+health+of+th e+global+economy+is+in+such+a+perilous+state+that+ there+is+potential+for+yet+another+global+financia l+crisis.)


Rupert Murdoch has warned the health of the global economy is in such a perilous state that there is potential for yet another global financial crisis.
The billionaire media magnate took to Twitter to voice his concern about the situation facing markets and how some central banks would struggle to bounce back if things worsened.
"All prices dropping not just shares. Timely correction or sign of major global crisis in near future?" the 84-year-old businessman wrote


Read more at http://www.9news.com.au/world/2015/08/21/13/16/murdoch-warns-of-global-crisis-in-tweets#9OBQY5HtsfBfev8y.99

A few points of interest Sgt Pepper - (a) I was discussing the NZ situation and I specified that (b) Murdoch was talking about the global situation (c) Murdoch is no economist, he may have a conceded pass in the Economics 1 of an accounting qualification but I somewhat doubt it (d) he's 84 (e) his empire is now visibly failing.

[noodles]

Good points KW. How will NZX perform on monday. It could go either way. There could be a ton of $$$ hunting for a "safe haven" or there could be a very sharp selloff.
Was the utility dominated and high yield NZX a safe haven during the GFC? Don't kid yourself. The NZX is NOT a safe haven. US government bonds or cash is the most likely destination for safe haven funds.

I think the most likely outcome this week is that markets are higher next Friday than last Friday as there appears to be "capitulation" everywhere. But I could be wrong. Who knows what the computer algorithms are programmed to do in situations like this. We have no precedent in history.

[Beagle]

The NZ index is a gross index and will be supported by the dividends being paid, especially in a continuing low interest rate environment. Also the NZ $ is falling, which is helping offset the declines in dairy prices (dairy has only been our biggest export earner since 2010, before that it was tourism). Unlike Australia where commodities make up 65% of export earnings, NZ is not so dependent on one export for revenue and exports like tourism/wine/forestry/wool etc will increase to compensate for the dairy decline. Whereas Australia is so over leveraged to commodities that the decline is ripping through the economy at both State and Federal levels. The NZ Index is also not dominated by a small number of companies like Australia (Four Banks, BHP/RIO and Westfield/Woolworths).

Going against that, is the fact that NZ could just be at the start of the downturn, with the bounce off the 200 day MA merely being a dead cat bounce, and a downtrend will shortly resume which will break the 200 day MA. At the end of the day the market is driven by fear/greed, so if everyone panics and starts selling out based on the depressing news from overseas, then it will become a self fulfilling prophecy.

The point is to make sure you have a plan, and that you act on it when the time comes. Its those that just shut their eyes and hope for the best, that suffer most - waking up a year later to find that half their portfolio has disappeared, and another five years after that, that they still havent gotten that money back. So remember, its not just about the initial drop that kills your returns, but the many long years it normally takes to get back to where you were (see Nasdaq - 15 Years!! Australia was still about 15% off its pre-GFC high BEFORE this fall - they could be waiting another decade to get back there as well).

A successful investor doesnt just know about how to make money, they also know how to protect the money they have made.

Nicely said KW. I will do a little cautious weeding in my garden this week. If I've held it for a while and it hasn't grown and at the minimum hasn't been paying me decent dividends, (in effect it's bearing no fruit of any kind), then it's a weed. Long term prospects might be good but my attitude is focus on the short to medium term in this volatile market.

[Baa_Baa]

There have been some discussing this likelihood for months now, of a downturn.

They put their plan in place quite a while ago and are "well positioned" for a negative market outcome in the short to medium term. For my part, despite some incredulous comments at the time, I'm happily out of almost all large/mid caps at a very nice profit and all are currently well below my exit price .. we are geniuses in a bull market (except one or two who shall remain nameless).

It's not too late to have a plan, but it might soon be too late to act on it. Just depends on how much you value your capital, and what insights you place importance on.

Best of luck to all, it's a new phase unfolding and still time to revise strategies.

Jmho of course, dyor, etc etc.

BAA

[Hoop]

Was the utility dominated and high yield NZX a safe haven during the GFC? Don't kid yourself. The NZX is NOT a safe haven. US government bonds or cash is the most likely destination for safe haven funds.

I think the most likely outcome this week is that markets are higher next Friday than last Friday as there appears to be "capitulation" everywhere. But I could be wrong. Who knows what the computer algorithms are programmed to do in situations like this. We have no precedent in history.
There has been some High Frequency trading algo gone insane history..there's been a few flash crashes,,2010 flash crash was the most insane and Wall St (which does a lot of HF trading) has now got fail safe measures installed.
...so there is some precedence but only in a bull market cycle correctional environment...I guess the next bear market cycle when panic and fear waves become prevalent (for humans and robots alike) it will be good tests as to how good these modern fail safe measures are..eh Denis ...

It has to be mentioned..that the Bull Market cycle is deemed to be alive until confirmation that it has died ...This latest event could be the healthy 10+% correction the market has been waiting for, to help free up available money and give this old Bull some future momentum and a new lease on life.

It is very difficult to tell the ending of the last phase Bull cycle and the beginning first phase Bear cycle. Reversions of the cycles can take months to
play out.

[nextbigthing]

There's a bit of talk about high divvy stocks not being safe havens.

Take stock x paying a 10% divvy. Financial crisis hits and it gets really hammered and can now only pay 5% (based on original purchase price) for a couple of years. Then it eventually recovers back to 10%. Shareprice does something like go from $1 to $0.5 during crisis then back to $1 and beyond in the recovery.

I get that you could sell at $1 before, wait a bit and buy in at $0.5 and make huge gains when it goes back to $1. I get that. But for a reasonably passive investor who just wants a fair return, doesn't have to sell and has time on there side, why not just ride it out? You'd still get 5% worst case. My point being surely good yielding divvy stocks are a haven if you have a passive strategy and no sell or time pressure.

PS) I'm not advocating this strategy, obviously the bigger gains are to be had by selling and buying back more, cheaper. I'm mearly pointing out that holding isn't the end of the world.

[see weed]

Been sitting on 60% cash for the last few months now waiting for a decent correction. AIA, EBO, FPH top of my shopping list.

I would like some Spark...$1.50c, maybe a bit of CEN....$3.20c, some more ATM.....30c and THL......$1.10c. And while we are there,a truck load of AIR....86c-$1 just like last time:).

[noodles]

There's a bit of talk about high divvy stocks not being safe havens.

Take stock x paying a 10% divvy. Financial crisis hits and it gets really hammered and can now only pay 5% (based on original purchase price) for a couple of years. Then it eventually recovers back to 10%. Shareprice does something like go from $1 to $0.5 during crisis then back to $1 and beyond in the recovery.

I get that you could sell at $1 before, wait a bit and buy in at $0.5 and make huge gains when it goes back to $1. I get that. But for a reasonably passive investor who just wants a fair return, doesn't have to sell and has time on there side, why not just ride it out? You'd still get 5% worst case. My point being surely good yielding divvy stocks are a haven if you have a passive strategy and no sell or time pressure.

PS) I'm not advocating this strategy, obviously the bigger gains are to be had by selling and buying back more, cheaper. I'm mearly pointing out that holding isn't the end of the world.
Just make sure the balance sheet is strong. If they have a drop in profitability, it may mean they may need to rebuild the balance sheet with a deeply discounted rights issue at the worst time.

[IAK]

I would like some Spark...$1.50c, maybe a bit of CEN....$3.20c, some more ATM.....30c and THL......$1.10c. And while we are there,a truck load of AIR....86c-$1 just like last time:).


Sounds good to me. I'll add them to the list might even grab a couple of dairy farms as well lol ��

[bull....]

Was the utility dominated and high yield NZX a safe haven during the GFC? Don't kid yourself. The NZX is NOT a safe haven. US government bonds or cash is the most likely destination for safe haven funds.

I think the most likely outcome this week is that markets are higher next Friday than last Friday as there appears to be "capitulation" everywhere. But I could be wrong. Who knows what the computer algorithms are programmed to do in situations like this. We have no precedent in history.

this isn't the gfc for starters otherwise all stock categories would have negative returns and that isn't the case.
rotation is occurring and nz and us utilities and treasuries are proving safe havens

I guessing nz may fall 1% today hardly a panic

[Beagle]

What KW said + Good REIT's like GMT with very low debt and long leases are not subject to the open bank resolution.

[noodles]

Did an exercise to see how far the NZX10 will have to fall to get to 2009 levels from a pe and yield perspective.

From a div yield perspective, it needs to drop about 9.6%
From a pe perspective, it needs to drop about 28%








2009

2015





pe
yield
pe
yield


Fletcher Building Ltd
FBU
9.8
5.78
12.92
4.91


Spark New Zealand Ltd
SPK
10.42
8.79
14.98
6.29


Auckland Intl Airport Ltd
AIA
18.61
5.09
35.54
2.07


Ryman Healthcare Group Ltd
RYM
13.25
3.72
28.1
1.8


Fisher & Paykel Healthcare Corporation Limited
FPH
26.78
3.92
34.29
2.07


Meridian Energy Ltd
MEL






SkyCity Entertainment Group
SKC
12
5.78
15.2
5.05


Sky Network Television Limited
SKT
18.32
3.37
11.51
5.75


Contact Energy Ltd
CEN
12
4.79
15.2
9.66


Infratil Ltd
IFT








15.1
5.2
21.0
4.7



Did not include IFT because it was loss making
Did not include MEL as it was not listed

[percy]

So which indicator do you think is the best guide,PE or yield.?
As a matter of interest what were interest rates/deposit rates in 2009.?
I must admit I looked on Saturday at the yields of a number of stocks I hold;AIR 5.14%,EBO,4.12%,SCL 6.49%,HNZ 7.10%.MEL 7.17%,SKL 6.95% and came to the conculsion I did not worry me if the market was closed for 3 or 4 years, so long as I continued to receive increasing fully imputated divies.

[winner69]

One of Aust papers had a bit about it being the recent new investors who deserted bank term deposits and went looking for yield that and they are now experiencing something new, like seeing their capital shrink. They maybe are the ones who will continue to sell as they desert the market forever. The grass wasn't really greener on the other side of the fence

[winner69]

Did an exercise to see how far the NZX10 will have to fall to get to 2009 levels from a pe and yield perspective.

From a div yield perspective, it needs to drop about 9.6%
From a pe perspective, it needs to drop about 28%








2009

2015





pe
yield
pe
yield


Fletcher Building Ltd
FBU
9.8
5.78
12.92
4.91


Spark New Zealand Ltd
SPK
10.42
8.79
14.98
6.29


Auckland Intl Airport Ltd
AIA
18.61
5.09
35.54
2.07


Ryman Healthcare Group Ltd
RYM
13.25
3.72
28.1
1.8


Fisher & Paykel Healthcare Corporation Limited
FPH
26.78
3.92
34.29
2.07


Meridian Energy Ltd
MEL






SkyCity Entertainment Group
SKC
12
5.78
15.2
5.05


Sky Network Television Limited
SKT
18.32
3.37
11.51
5.75


Contact Energy Ltd
CEN
12
4.79
15.2
9.66


Infratil Ltd
IFT








15.1
5.2
21.0
4.7



Did not include IFT because it was loss making
Did not include MEL as it was not listed

Interesting stuff noodles

So if PE ratios generally fall to more reasonable levels (historically so) we could see heaps more downside

[Hoop]

Fibonacci Retracements can show approximate ends to panic drops (Note: 50% and 100% are not true fibs)......Usually a >20% drop signals a bear market cycle (~4800)
the second chart shows a possible future... the boundary limits the index can waver round in

http://i458.photobucket.com/albums/qq306/Hoop_1/NZX50%2021082015.png (http://s458.photobucket.com/user/Hoop_1/media/NZX50%2021082015.png.html)
http://i458.photobucket.com/albums/qq306/Hoop_1/NZX50%2021082015a.png (http://s458.photobucket.com/user/Hoop_1/media/NZX50%2021082015a.png.html)

[Beagle]

Good work Noodles.

P.S. Just had another look at the relative PE's of RYM....WOW...I reckon some of these stocks on a PE of ~30, especially SUM without such a long and well established track record of growth or even worse stocks like XRO which has nothing but a bunch of talk supporting its SP are going to get their wings seriously clipped.

[Hoop]

Market opened at 5471 -2.4% the spooky fib is the 61.8% one.....so lets see if the panic behaviour ends here....near 5400

[ratkin]

Good work Noodles.

P.S. Just had another look at the relative PE's of RYM....WOW...I reckon some of these stocks on a PE of ~30, especially SUM without such a long and well established track record of growth or even worse stocks like XRO which has nothing but a bunch of talk supporting its SP are going to get their wings seriously clipped.

You never miss an opportunity to have a go at SUM

[Beagle]

You never miss an opportunity to have a go at SUM

Nah I missed a couple lately...just calling these ~30 PE stocks as over-priced as I see them. Bundle in AIA FPH and a few others if it makes you happy...all probably deserve a good reality check...I mean look at AIA the other day, was it yesterday...so much is happening at the moment its hard to keep up. What was it ? a 4% profit rise and the PE is mid 30's...bloody ridiculous IMO. Look at the PE expansion in the comparatives that Noodles posted...totally unwarranted in many cases.
The Chinese market as a whole after this correction is on a PE of ~17 and yet some of our stocks are on close to double that :eek2: Doesn't make sense...just saying.

[Onion]

P.S. Just had another look at the relative PE's of RYM....WOW...I reckon some of these stocks on a PE of ~30, especially SUM without such a long and well established track record of growth or even worse stocks like XRO which has nothing but a bunch of talk supporting its SP are going to get their wings seriously clipped.

Holders of SUM are lucky then that they have more SP gain over the last year or 2 to give up (compared to RYM).

[Toulouse - Luzern]

NZX today...

Three white Samuari

are

much better

than

three black crows ...

[Major von Tempsky]

A very perceptive and discerning comment Toulouse-Luzern. I don't know why Hoop keeps cluttering up our screens with that meaningless superstitious gibberish. Buffett has said he doesn't use it, has no use for it, so have the banks and any number of other analysts. No one has yet been put forward as having made a fortune from "technical" analysis. There should be a separate board for arcane religions. The only people to make a fortune out of "technical" are the sneaky purveyors of "technical" software, books, "tutorials" to the lower classes.

[allfromacell]

A very perceptive and discerning comment Toulouse-Luzern. I don't know why Hoop keeps cluttering up our screens with that meaningless superstitious gibberish. Buffett has said he doesn't use it, has no use for it, so have the banks and any number of other analysts. No one has yet been put forward as having made a fortune from "technical" analysis. There should be a separate board for arcane religions. The only people to make a fortune out of "technical" are the sneaky purveyors of "technical" software, books, "tutorials" to the lower classes.

I admit to having very little knowledge in finance/investing as I'm very new to this, (early twenties just started working) but from what I've seen so far I completely agree. It seems to be the typical case of humans looking for patterns in absolutely everything even when they don't exist, when they do work it just aids our bias. In saying this, I do find it fascinating, perhaps it works as a self-fulfilling prophecy? If anyone has any objective books or information on TA I would love to look further.

[BlackPeter]

I admit to having very little knowledge in finance/investing as I'm very new to this, (early twenties just started working) but from what I've seen so far I completely agree. It seems to be the typical case of humans looking for patterns in absolutely everything even when they don't exist, when they do work it just aids our bias. In saying this, I do find it fascinating, perhaps it works as a self-fulfilling prophecy? If anyone has any objective books or information on TA I would love to look further.

Actually - I enjoyed the Majors response, but I thought it was meant to be ironic?

I don't think anybody says that TA is the only useful tool in the box, but as long as share prices are driven by humans (or any other animal running in flocks) does it make sense to measure and consider the history and the current speed and direction of the flock to draw conclusions where they are likely to go ... Sure - it does not work always, and it is useful to take other factors into consideration as well, but it does work more often than not.

[Hoop]

NZX today...

Three white Samuari

are

much better

than

three black crows ...


Yes good short term bullish candlesticks..Although the NZX50 index hasn't fallen much the chart shows there has been huge technical damage....Things aren't looking great
5700 /5750 are areas to watch which could see any new rally peter out....

Dangerous time to buy in under the 5700/5750... (the rule:.. buy near supports not near resistances)

The wise are out and waiting to see what develops

Disc: still 99% "in" (my stocks haven't fired sell signals yet)

http://i458.photobucket.com/albums/qq306/Hoop_1/NZX50%2009092015.png (http://s458.photobucket.com/user/Hoop_1/media/NZX50%2009092015.png.html)

[skid]

I admit to having very little knowledge in finance/investing as I'm very new to this, (early twenties just started working) but from what I've seen so far I completely agree. It seems to be the typical case of humans looking for patterns in absolutely everything even when they don't exist, when they do work it just aids our bias. In saying this, I do find it fascinating, perhaps it works as a self-fulfilling prophecy? If anyone has any objective books or information on TA I would love to look further.

I believe KW has mentioned a few

[Xerof]

The generally acknowledged 'bible' is Technical Analysis of the Financial Markets, John J Murphy.

[sb9]

S&P/NZX 50 5,677 -0.86%

This is what is on NZX website (NZX.com) as I type this, must be something wrong there as it says NZX 50 down .86% while its only down about 20 point or so.

Any explanations or is it just that NZX can't do their math right?

[Hoop]

There are 2 bibles the other one is Encyclopedia of Chart Patterns 2nd Ed by Thomas N Bulkowski The book has 1035 pages :)..He also has a website The Patternsite (http://thepatternsite.com/)

[banter]

S&P/NZX 50 5,677 -0.86%

This is what is on NZX website (NZX.com) as I type this, must be something wrong there as it says NZX 50 down .86% while its only down about 20 point or so.

Any explanations or is it just that NZX can't do their math right?
The .86% fall is from today's open, not yesterday's close.
Yesterday's close would be better IMO.
For some reason (pre market trades?) it gapped up on open to 5725 this morning, then slid back rapidly.

[Hoop]

S&P/NZX 50 5,677 -0.86%

This is what is on NZX website (NZX.com) as I type this, must be something wrong there as it says NZX 50 down .86% while its only down about 20 point or so.

Any explanations or is it just that NZX can't do their math right?

Who knows..the whole NZX website is a bit of a mystery..can't find half of the stuff that's suppose to be on there..
At close today 5,654 -42 -0.7%

[percy]

The generally acknowledged 'bible' is Technical Analysis of the Financial Markets, John J Murphy.

I thought the "bible" has always been:
Technical Analysis of Stock Trends,by Robert D Edwards and John Magee,isbn.9780814408643

[Nasi Goreng]

Is NZX50 currently best performing index in the world? Only 5% down on highs. There can't be many indices that are doing better... are things really that good here?

[percy]

Is NZX50 currently best performing index in the world? Only 5% down on highs. There can't be many indices that are doing better... are things really that good here?

Yes things here are even better than "that good".
As Fred Dagg always said;"We don't know how lucky we are."
I hold or have an interest in the following companies that are performing really well;
AIA,AIR, AWK,CVT,EBO, FPH, FRE,HNZ,MEL,SCL,SEK,SKL,SUM,RYM and TIL.
And on the unlisted market my PAZ and REL are well positioned.!

[Hoop]

Is NZX50 currently best performing index in the world? Only 5% down on highs. There can't be many indices that are doing better... are things really that good here?

To us Kiwis, not too bad
But overseas investors not so good as our NZ$ has tanked somewhat

[winner69]

Markets set to tumble Monday
http://www.theage.com.au/business/markets/paris-attack-shaky-markets-set-to-tumble-20151115-gkz9nq.html

I reckon NZX will be OK though

[Baa_Baa]

Markets set to tumble Monday
http://www.theage.com.au/business/markets/paris-attack-shaky-markets-set-to-tumble-20151115-gkz9nq.html

I reckon NZX will be OK though

I won't be until the afternoon, imho, that NZX decides what's what, which is the curse of being the first market to open the week (and rather small and insignificant in the scheme of things). With ASX coming online at midday, China and Asia to follow and the big money after that. DOW and SP500 futures aren't exactly tanking at the moment (9:00pm NZ time), but they are down.

Edit: maybe should also note that the USD is falling and Gold which loves a crisis is rallying. All these things conspire against an orderly day on the NSX. Beware the NZX stocks which have already turned over along with the DOW/SP5 decline last week, look for the correlations.

JMO,
BAA

[bull....]

Markets set to tumble Monday
http://www.theage.com.au/business/markets/paris-attack-shaky-markets-set-to-tumble-20151115-gkz9nq.html

I reckon NZX will be OK though

these things usually present great buying opportunities, if it happens

[BlackPeter]

True. Just looked at the 9/11 SP development. NZX 50 went after the attack quite quickly down by roughly 15 to 20 percent but recovered within 2 to 3 months to reach higher highs.

Obviously - this one was luckily much smaller than 9/11 - and so should be the fallout.

In my view no need to panic (well, from a financial perspective - obviously we need to do something about the terrorists).

[bull....]

True. Just looked at the 9/11 SP development. NZX 50 went after the attack quite quickly down by roughly 15 to 20 percent but recovered within 2 to 3 months to reach higher highs.

Obviously - this one was luckily much smaller than 9/11 - and so should be the fallout.

In my view no need to panic (well, from a financial perspective - obviously we need to do something about the terrorists).

actually the terriosts are probably the only ones hoping the market has a big fall

[bull....]

pre futures at this time are pointing at a 1% fall uk and dax 1.5% us .75% fall hardly a big reaction

[Hoop]

pre futures at this time are pointing at a 1% fall uk and dax 1.5% us .75% fall hardly a big reaction
I don't think there is much Paris effect either....Bull
All the Friday (pre Paris) Technicals I've looked at are either breaking or about to
Here's the Friday's NZX50 chart below...It looks too high and about to break down...so, even without Paris it would've come as no surprise to see the NZX50 break down on Monday.

Update today...the NZX50 has broken down...the 5965 Support is a goneburger...intra-day presently at 5946 -43 (-0.7%)

At the moment the signs are that NZX50 mightn't fall far as there is Good support around 5865 (EMA50 + Primary trend line)..and.. the break Out (down) Target Price is 5965-(6080-5965) = 5850
Time will tell
http://i458.photobucket.com/albums/qq306/Hoop_1/NZX50%2013112015.png (http://s458.photobucket.com/user/Hoop_1/media/NZX50%2013112015.png.html)

[smpl]

Approaching psychological barrier of 7,000.

Did some (crude) analysis to compare other periods with strong bull markets:

1977 - 1986 Low 300 High 330 Total Return 1100% Annualized return 31%
1990 - 1983 Low 1100 High 2250 Total Return 204% Annualized return 19.5%
2002 - 2007 Low 1880 High 4302 Total Return 228% Annualized return 23%
2008 - 2016 Low 2522 High 6950 Total Return 275% Annualized return 15.5%

8030

So some upside still possible. NZX50 foresee-ably at 10k or even as high as 16k using other seen annualized returns.

[IAK]

Martin Hawes is reducing his share portfolio. "Selling shares to beat the market"
http://www.stuff.co.nz/business/opinion-analysis/80131785/Martin-Hawes-Selling-shares-to-beat-the-market?

[smtrader]

Martin Hawes is reducing his share portfolio. "Selling shares to beat the market"
http://www.stuff.co.nz/business/opinion-analysis/80131785/Martin-Hawes-Selling-shares-to-beat-the-market?

yeah he is, hoping the attention he gets will prompt others to sell so perhaps he can add some more to his position.. i don't think his view carries any weight whatsoever.

[troyvdh]

gee smtrader...that is truly a conspiracy theorist post...one of the better ones......Martin ( I agree he is not regarded as MKT commentator heavyweight)...his posts are generally ..well ..general ...for you to think what you do...suggests to me ..you need to broaden your horizon re information sources...anyways cheers

[Lewylewylewy]

Not that much of a conspiracy theory. If I could manipulate the market I would. Of course everyone would, just about.

[jonu]

gee smtrader...that is truly a conspiracy theorist post...one of the better ones......Martin ( I agree he is not regarded as MKT commentator heavyweight)...his posts are generally ..well ..general ...for you to think what you do...suggests to me ..you need to broaden your horizon re information sources...anyways cheers

Are you...Christopher Walken...? Or perhaps....someone else?

[Lewylewylewy]

So, the US is increasing interest rates... are they trying to dupe us into thinking everything's fine now, or is the future starting to look bright?

[Hoop]

Apart from 2 scares in recent months The good news is still happening after 7.5 years :t_up::t_up:...Has to be the best performing stockmarket for a few years now ..and especially so these last 9 months...

The great news was the milestone a couple of months ago when theoretically the buy and holders who entered at the height of the 2007 boom finally began making a capital profit...A warning for other entrants climbing aboard and adopting a buy & hold strategy at the exuberance period late in the bull cycle..

I Used the capital index as it probably compares better with the other indexes such as DOW and S&P500.

The NZX50 Bull Market Cycle is very old...maybe its life has been extended by the bull sleeping through 30 - 40% of it..

http://i458.photobucket.com/albums/qq306/Hoop_1/NZX50c%2016062016.png (http://s458.photobucket.com/user/Hoop_1/media/NZX50c%2016062016.png.html)

[Bjauck]

What are the smart investors doing now that Brexit polls are 50:50?

[ratkin]

What are the smart investors doing now that Brexit polls are 50:50?


http://www.oddschecker.com/politics/british-politics/eu-referendum/referendum-on-eu-membership-result

Not exactly 50-50

[BlackPeter]

What are the smart investors doing now that Brexit polls are 50:50?

Assuming you removed the weak shares a long time ago (as a smart investor would have) from your portfolio, the best strategy might be to just enjoy the entertainment ... ah yes, and keep some powder dry.

If Britain stays, shares are likely to go up (well, until we have the next drama, and this can be soon). If they go markets might have a handful of weeks full of turmoil, but afterwards? I am pretty sure the earth keeps spinning around the sun and turmoil might be good to pick up some better priced shares ...

[couta1]

Funny how some worry about every bit of bad news as if the roof is going to collapse on them, I just continue as normal, in fact I just borrowed another 100k yesterday at 4% and bought Ryman shares today (Happy to buy them at current prices) Besides all my red arrow stocks have nothing to do with the Brexit anyway, stocks such as Air and NZR were already down. PS-In case you were wondering I'm negatively geared around 15% of my portfolio total and quite comfortable with that. PPS-Picking a stay vote.

[troyvdh]

Couta...love your post...sort off...I just hope that folk with perhaps less nouse than you..could/would possibly think that you've done is ...well.."the way to riches"...which we know is indeed a long way from the truth....anyways cheers...just saying..

[couta1]

Couta...love your post...sort off...I just hope that folk with perhaps less nouse than you..could/would possibly think that you've done is ...well.."the way to riches"...which we know is indeed a long way from the truth....anyways cheers...just saying.. Just stating what I've done, each person must follow their own path and one they are comfortable with. I'm pretty battle hardened in terms of the market which was learnt by sticking it out through tough times.

[Edwood]

Looking like the tender timer is nearly ready to pop on NZ50 - shame CMC don't offer a price on the index.

[Edwood]

Potential for one push higher yet (maybe...), but given the shooting star on the weekly that could be it. Wonder how long it takes before we are back at 6,000

[Hoop]

Potential for one push higher yet (maybe...), but given the shooting star on the weekly that could be it. Wonder how long it takes before we are back at 6,000

Hmmmm. it does looks somewhat ominous doesn't it Edwood.......well spotted......

[Edwood]

its had an impressive run and probably sensible to take some profits, in my opinion - it could unwind quickly given >50% offshore ownership and potential drop in NZD.... also bull flag setting up on the VIX, next few weeks could be interesting

8305

[axe]

https://milfordasset.com/potential-problems-nzxs-high-level-foreign-investment/

Wouldn't the impact of a drop in the NZD be lower due the higher % that is owned domestically.


its had an impressive run and probably sensible to take some profits, in my opinion - it could unwind quickly given >50% offshore ownership and potential drop in NZD.... also bull flag setting up on the VIX, next few weeks could be interesting

8305

[Hoop]

Apart from interventions, I usually assume a flight of money away from NZ when theNZ$ is in a downtrend ..and..I assume the NZ stockmarket falls when there is less "available" money.

Foreign ownership??..The figures I see are all different..and all over the place. Many current publications recite old data

"There are three kinds of lies: lies, damned lies and statistics."..Mark Twain

......It seems the "glaring" difference revolves around whether the ~18% strategic investors are taken into account or not into account...

Typical media!!!...when an outfit is out to blame rising share prices on rising foreigners ownership they recite the ~46% (or whatever) which excludes the ~18% strategic investors..When the strategic investors are taken into account, foreign ownership is much less.. around ~33%...But these figures I use are an average of differing data I've read and much of that is outdated..Honestly I don't think anyone really knows, so approximates will do.

What does affect the NZX is the degree of "available" money v "non-available" money such as the movements of freed up shareholdings which is the maximum 82% of total share holdings..I say maximum because there many very strict disciplined large individual buy and hold investors out there + the likes of various strict fund vehicles floating around so some of that 82% free float stuff is probably not that "free"...and yeah, probably ~46% of that 82% of total share holding would be foreign money....

The chart below is my crude attempt to show some sort of foreign money flow by assuming demand effects the $ value and assume some of that money flow would effect the NZX stock demand... US$ A$ comparison with NZX50index....Long term correlation is not that great..but the shorter term sudden movements seem to be correlating ....The most obvious event on the chart is the flight of available money away from NZ in 2008 and the corresponding impact on the share market...Less obvious events are:.. something happened around 2010, late 2011 the Winter 2015 and the charting paradox of early 2006.

8306

[Edwood]

thanks Axe, although that article is 18 months old so the data its based on is even older.

NZX is a yield play, bond yields are starting to rise offshore - double whammy for NZ50 and NZD when the yield trade unwinds. Will be interesting to see how some of these income funds into high yielding bonds & equities will perform.

The trend is your friend until the bend at the end...

[axe]

Those term deposits rolling over form 5 years ago have to go somewhere. The kiwisaver funds keep trickling in. Our reserve bank has actively stating the dollar is overvalued for some time. The likely hood of further cuts the NZ OCR rate before the years end seems high. I agree that the NZX is a yield play.

Are there some stocks on the ASX looking tasty with our currency looking like its going to peak at about 1:1?



thanks Axe, although that article is 18 months old so the data its based on is even older.

NZX is a yield play, bond yields are starting to rise offshore - double whammy for NZ50 and NZD when the yield trade unwinds. Will be interesting to see how some of these income funds into high yielding bonds & equities will perform.

The trend is your friend until the bend at the end...

[Lewylewylewy]

...Are there some stocks on the ASX looking tasty with our currency looking like its going to peak at about 1:1?

Yup: NZX:ANZ ;)

[Valuegrowth]

One year return around 27%. Not that bad. It has more legs.



Day's Range:

7,196.24 - 7,263.20



52wk Range:

5,573.71 - 7,585.29




http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11711758

Index snaps losing streak as NZ Refining and SkyCity climb

After this period of volatility, it should pass 52 week high as well.

[Edwood]

After this period of volatility, it should pass 52 week high as well.

Maybe...the risk is to the downside in my opinion, better to take some cash off the table ready for future opportunities, those 3 red daily candles off the top don't look particularly bullish to me and the shooting star on the weekly looks like a tender timer ;)

[bull....]

broke thru previous low 7200 heading to that 7000 level as mentioned on some thread a while back cant remember which one

[sb9]

I think tonight's jobs report is key catalyst for what happens to interest rate decision by fed as we inch closer to year end.

[Mush]

I think tonight's jobs report is key catalyst for what happens to interest rate decision by fed as we inch closer to year end.

Agreed. We're being set up for a risk off move next week, which could be severe for equities.
GBPUSD move this morning showed me how fragile markets and liquidity can be in times of stress.

[Edwood]

Dow has coiled into a triangle, suggests a 600pt move one way or the other.... NZD already selling off and that GBP spike may give some guidance imo

[Under Surveillance]

Dow has coiled into a triangle, suggests a 600pt move one way or the other.... NZD already selling off and that GBP spike may give some guidance imo
A very lucid post. I'm acting accordingly, buying triangles and selling spikes.

[Edwood]

Happy to wait a bit longer on the triangle - although Yellen has already said she'll be into the ETFs...

[Edwood]

Likely to see more downside for NZ50 today. NZD under pressure

Dow & S&P both broken down out of their triangles, R2K down 2.3%
While FTSE has been held up by GBP weakness, watch out when it goes! Nice ending diagonal shaping up for the Brexiteers 8352

[winner69]

Economy roaring ahead at 4% plus gdp growth and still RBNZ talking OCR cuts

Ludicrous - watch out 2018 for the inevitable bust, a bust will be worse then need be

[bull....]

at first level next stop 6800 I reckon

[Valuegrowth]

NZ market is under performing other Asian-pacific markets these days. We should see some volatility in the short run.

[Mush]

at first level next stop 6800 I reckon


8368

Agreed.

[bull....]

8368

Agreed.

reversion to the mean highly likely considering it was extended as your chart shows

[Hoop]

at first level next stop 6800 I reckon..Bull

8368

Agreed.

An extended rising channel shows irrational behaviour in the form of exuberance....These log term chart channel set-ups all end badly..worse than a situation of an original channel break...It could be as bad as 5500..being long term any eventual break down could take some time to happen...I'm presently eyeing up a possible H&S Pattern forming

A possible scenario (my very inaccurate crystal ball) is we might see a very common head and Shoulder pattern form with the fall bouncing up off the 6600/6800 (neck) and the rally (shoulder) hit the top of the primary channel 7050 (resistance)..another fall only creates a danger if it breaks the neckline creating a target price of 6000
This time is different ;)

[bull....]

hopefully no H&S patterns eventuate.

anyway interesting to note the sell off in nz dollar and the correlation with the sell off in stocks.
the high correlation of property and retirement stocks selling off in correlation with the nz dollar, funny thing is these two sectors are being the most aggressively sold by some people - do offshore people see the top in the property market?
then followed by spk and utilities so probably postioning for fed hike? when you consider nz50, gold, tlt are the worst performing markets on my watchlist last 30days

[Mush]

hopefully no H&S patterns eventuate.

anyway interesting to note the sell off in nz dollar and the correlation with the sell off in stocks.
the high correlation of property and retirement stocks selling off in correlation with the nz dollar, funny thing is these two sectors are being the most aggressively sold by some people - do offshore people see the top in the property market?
then followed by spk and utilities so probably postioning for fed hike? when you consider nz50, gold, tlt are the worst performing markets on my watchlist last 30days

Interesting to note that the correlation between NZD and NZX has decoupled this week so far. NZD has rallied off 0.7070 to be around 0.7175 at time of post. However we've seen the NZX drop close to 1% yesterday and so far down over 1% today.

8375

[bull....]

depends on the timeframe you are looking at but yes they have decoupled this week so maybe locals are selling now?

[bull....]

utilities , property and retirement stocks still getting sold down

[sb9]

utilities , property and retirement stocks still getting sold down

All those are big boys toys, so no surprises there they're reducing their holdings...

[kiora]

All those are big boys toys, so no surprises there they're reducing their holdings...

Hopefully they have all disappeared into the void for a while.Next few days will be interesting. FPH & IFT have had a battering lately,looks like there is a few interested buyers at these levels so far today though :mellow:
Time for growth Cos to show their flare again?

[Edwood]

Decent down day today, well into correction territory now. The risk is that we head for the 5,900 zone - which is very possible once global indices start to sell off. There is a strong possibility that the larger traders will push US markets down hard prior to December in the hope of deferring the US Dec rate hike, NZ will likely follow

[Joshuatree]

Not quite there by my calls. NZX 50 is re 7.5% off the high and NZX ALL 8.5% as at the end of today.. 10 % is official re in a correction mode.. Not far to go though after days like today ;NZX 50 down 1.43%, NZX ALL1.5%, for us to be in that correction .

[Edwood]

true JT, my error ;) not far away now.
VIX put in a decent pop higher overnight, shaping up for an interesting end of year

[iluab]

Not quite there by my calls. NZX 50 is re 7.5% off the high and NZX ALL 8.5% as at the end of today.. 10 % is official re in a correction mode.. Not far to go though after days like today ;NZX 50 down 1.43%, NZX ALL1.5%, for us to be in that correction .

Depends on ones perspective, there are still a lot of cyclical dividend paying stocks with very very bloated PE ratio's.

One could argue that the massive yeild seeking inflow into the NZ50 over the last year is reversing now global bond yields appear to be on the rise.

Folks, to give a feel for the level of bloat, have a gander at the attached S&P500 vs NZ50 comparison, we could easily see another 10% to 15%, lower in my opinion.

8424

[Joshuatree]

Money leaving NZX etc is my opinion too.Dont know which is the NZX chart on your chart.

[iluab]

Money leaving NZX etc is my opinion too.Dont know which is the NZX chart on your chart.

Green buddy, a bit alarming ay ?

[winner69]

Depends on ones perspective, there are still a lot of cyclical dividend paying stocks with very very bloated PE ratio's.

One could argue that the massive yeild seeking inflow into the NZ50 over the last year is reversing now global bond yields appear to be on the rise.

Folks, to give a feel for the level of bloat, have a gander at the attached S&P500 vs NZ50 comparison, we could easily see another 10% to 15%, lower in my opinion.

8424

Spooky chart possums

[bull....]

nearly back to the mean of the channel 6800, bottom is at 6200 maybe next week?

[iluab]

nearly back to the mean of the channel 6800, bottom is at 6200 maybe next week?

The chart seems complicit with that Bull, if we are heading back to the primary trend, a bottom somewhere between 6,300 and 6,700 ay ?

That would bring the NZ50 back in line roughly with the S&P500 also.

8425

[bull....]

The chart seems complicit with that Bull, if we are heading back to the primary trend, a bottom somewhere between 6,300 and 6,700 ay ?

That would bring the NZ50 back in line roughly with the S&P500 also.

8425

lots of fib supports around that 6300 area, I got my bottom of channel figure mixed up should have been around 5800 if you take it from start of bull market in 2009 im using standard error channel also around the 200 week ma.

end of the day its probably all meaningless when macro factors seem to determine what happens lol big week next week and dec

[iluab]

Yield outflows be outflowing, 11% correction so far folks, more to go I'm picking.

http://www.scoop.co.nz/stories/BU1611/S00150/nz-shares-fall-in-correction-from-september-high.htm

[bull....]

spooky a, on the hourly nz50 found resistance at 6800 and declined from this figure and is now heading to lows

[iluab]

Been a long while since I've seen the NZ10 up 2.5% and climbing, NZ50 up 2%.

Where to from here, has anyone a technical view (charting) ?

[winner69]

Been a long while since I've seen the NZ10 up 2.5% and climbing, NZ50 up 2%.

Where to from here, has anyone a technical view (charting) ?

Just shows you how stupid the world is these days

[BlackPeter]

Been a long while since I've seen the NZ10 up 2.5% and climbing, NZ50 up 2%.

Where to from here, has anyone a technical view (charting) ?

Charts are not predicting the future ... and NZX charts are certainly not predicting the outcome of the US elections. Having said that ... charts can obviously capture what outcome people predict at a certain point in time. If we assume these people are right, than here you have it - do some NZX charting and you know how the US will vote.

But now I am wondering why they go to these lengths and expenses anyway. It might be sufficient for the US to just set the election date and chart the NZX to pick the president accordingly. Up trend - pick Clinton, downtrend - pick Trump.

Obviously - just kidding.

[kiora]

Been a long while since I've seen the NZ10 up 2.5% and climbing, NZ50 up 2%.

Where to from here, has anyone a technical view (charting) ?

Seems like NZD/US gives better indication of future direction

[Valuegrowth]

Just shows you how stupid the world is these days

I agree with you.

Whoever come to power, there should be demand for stocks. In other words there should be post-Clinton winning stocks or post-trump winning stocks.

How do we identify winners in any type of market situation?

Identification of the key winning sectors and stocks within the stock market is an important analytical task.

NZ market is also not dead yet. Still, its major uptrend is intact.

[Hoop]

The chart seems complicit with that Bull, if we are heading back to the primary trend, a bottom somewhere between 6,300 and 6,700 ay ?

That would bring the NZ50 back in line roughly with the S&P500 also.

8425

Been a long while since I've seen the NZ10 up 2.5% and climbing, NZ50 up 2%.

Where to from here, has anyone a technical view (charting) ?

Technical view.....iluab you have partially answered your question...
The good news, NZX50 has bounced up and away from the primary (bull/bear line) support ~6600 area..
The bad news, the NZX50 is still technically broken but today's rise nearly reclaimed the MA200.
The good news, the NZX50 is still in a primary uptrend (Bull Market Cycle)
The bad news, there may be a H&S pattern forming... these are very common and very reliable bearish patterns once they are formed.....so it pays to keep an eye on the progress of this one and hope it breaks up and the pattern disintegrates.....but in the meantime, there is odds on that happier times are to be had as the right shoulder starts building, so reaching 7000/7100 seems to be on the cards...

[iluab]

Cripes, here we go, trump uncertainty ay, ASX200 tanking too, should be a buying op at the bottom though I reckon. Brexit was three days to turn around and bounce, let's see ?

[blobbles]

Methinks that if its close and we hit the western sea board, Hilary should take it easy. California is usually very democratic and would almost certainly vote for Hilary by a wide margin. Being one of the most populous areas... may pay to hold your shares if this bounces off the back of results there. Bounce might happen tomorrow though as our market close is after that one comes in.

[iluab]

http://www.scoop.co.nz/stories/BU1611/S00363/us-presidential-election-trump-looking-likely-victor.htm

I think it will short lived even if Trump wins, which is looking probable now, fundamentally, like Brexit there was no fundamental short term change, and the american politico's will move to talk it through over the next couple of days to appease the markets quite quickly one would expect.

So I agree bobbles, it's not worth trying to trade this, just as it wasn't Brexit, short lived for sure.

[Peitro]

If you think Hilary has any shot, its paying $7 on betfair at the moment

[pierre]

Methinks that if its close and we hit the western sea board, Hilary should take it easy. California is usually very democratic and would almost certainly vote for Hilary by a wide margin. Being one of the most populous areas... may pay to hold your shares if this bounces off the back of results there. Bounce might happen tomorrow though as our market close is after that one comes in.

There are only 74 Electoral College votes in Washington, Oregon and California combined. No way Hillary is going to climb this mountain and reach 269 votes I'm afraid. Would have been nice if she'd been able to do an Ed Hilary and "knock the bastard off" - but looks like she's run out of oxygen.

[winner69]

Pity the market doesn't stay open for longer on these days

Heaps of bargains on offer if trading continued

Pity is when the comeback kid wins in the end the market will open with higher prices tomorrow morning

[Edwood]

5,900 will be on the radar before we know it, the tender timer worked to perfection again ;)

[Bobdn]

Just after Brexit I tried to move a huge (by my standards) wad of cash into the market but missed out. Hopefully the market will move down lower and longer this time to give us an even chance. A progressive 30 to 40% drop over a 12 month period would be ideal.

[Bobdn]

I should add that one of main investments is Devon's Alpha fund which has been hording 40% cash. I wonder if they will deploy the cash now?

[huxley]

FTSE 100 only down 1%

[Valuegrowth]

Now it is just 0.19 percent. It fell more than 2 percent in the early trading.It might enter green territory by the end of the day. We will wait and see. As I said, markets should rebound by Friday.. After huge drop European markets are recovering. Trump’s presidential words bought some confidence among investors.
FTSE 100 only down 1%

[davflaws]

Obviously - just kidding.

I don't think 'Murica got the joke

[BlackPeter]

I don't think 'Murica got the joke

... you might well be right, which is a pity - given that I think they won't have a lot to laugh over the next dozen years or so ...

[iluab]

http://www.scoop.co.nz/stories/BU1611/S00363/us-presidential-election-trump-looking-likely-victor.htm

I think it will short lived even if Trump wins, which is looking probable now, fundamentally, like Brexit there was no fundamental short term change, and the american politico's will move to talk it through over the next couple of days to appease the markets quite quickly one would expect.

So I agree bobbles, it's not worth trying to trade this, just as it wasn't Brexit, short lived for sure.

Cripes, all in fast forward, Trumps the "growth president", all good, should be an interesting day for all, enjoy

[winner69]

See our friend Wheeler has done the heroicy thing and cut the OCR again

Just makes the inevitable bust after the current boom even more painful

[iluab]

See our friend Wheeler has done the heroicy thing and cut the OCR again

Just makes the inevitable bust after the current boom even more painful

Agree Winner, seems a little unnecessary this one given the construction and immigrant growth enduring, well and the GDT recovering and on the rise, should be the last though ay ?

[macduffy]

Agree Winner, seems a little unnecessary this one given the construction and immigrant growth enduring, well and the GDT recovering and on the rise, should be the last though ay ?

This morning's move was inevitable after the RBNZ had spent the last several months "preparing" the market for another cut. Sometimes, the less said, the better!

[Hoop]

See our friend Wheeler has done the heroicy thing and cut the OCR again

Just makes the inevitable bust after the current boom even more painful
Agree.......

[Edwood]

How was that futures action this week? Crazy days, interesting that they 'crashed' the market out of hours. When viewing the daily cash chart you wouldn't even know it happened. Maybe it was just a huge stop run to take out stops on longs before running things higher into Christmas.

I think its also telling that NZ50 is not participating in the recovery. The yield play looks to be over

http://www.reuters.com/article/us-global-markets-idUSKBN13600Z

[winner69]

NZX50 only down 10 last week, stuff all really

One of better weeks of late

No worries

[bull....]

correction from sept might be ending price sits right on down trend line from sept so chartists will be watching for upside breakout

[BlackPeter]

Happy New Year everybody ... and just to start the New Year on a high note:

While the US and Australasia indulged in their observed and other New Year holidays are other markets already busy creating value for 2017:

DAX (Germany) up 150 points (roughly 1%) and it sounds like other European markets (Italy) did well as well. Nikkei edged up, only South Korea was somehow mixed, but this might be related to their home made problem (president impeached).

Looking forward to Australia and the US markets overnight ...

[winner69]

Happy New Year everybody ... and just to start the New Year on a high note:

While the US and Australasia indulged in their observed and other New Year holidays are other markets already busy creating value for 2017:

DAX (Germany) up 150 points (roughly 1%) and it sounds like other European markets (Italy) did well as well. Nikkei edged up, only South Korea was somehow mixed, but this might be related to their home made problem (president impeached).

Looking forward to Australia and the US markets overnight ...

ASX open today eh

[Valuegrowth]

It is showing its strength again. It went Up by more than 3.44% during past month beating markets such as China, Australia, Singapore, Taiwan, Hong Kong, Japan and South Korea.

[bull....]

correction from sept might be ending price sits right on down trend line from sept so chartists will be watching for upside breakout

nice bounce from support but still underperforming other markets

[Valuegrowth]

52 week 6,587.42 - 7,613.19



https://www.nzx.com/markets/nzsx/indices/NZ50

7,593.260

[Valuegrowth]

One year return around 27%. Not that bad. It has more legs.



Day's Range:
7,196.24 - 7,263.20


52wk Range:
5,573.71 - 7,585.29



http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11711758

Index snaps losing streak as NZ Refining and SkyCity climb

After this period of volatility, it should pass 52 week high as well.

Is it heading toward 7700 or 7800 by the end of this year or will there be pull back?

http://www.findata.co.nz/Markets/StockQuote/NZX/NZ50.htm

7,596

26 Jun 17 17:48

[couta1]

The NZX is running hot all right, but other than the likes of the retirement stocks and a few others, perhaps just too hot to last, bit like holding a hot potato aye.

[maccadac]

Hi guys do you think its a good time to sell? Im thinking about putting it towards my mortgage? would be around 50k total.
Thanks

[bull....]

that 7500 level was crossed couple times and failed then broke and retested and respected looking good

[JeremyALD]

The NZX is running hot all right, but other than the likes of the retirement stocks and a few others, perhaps just too hot to last, bit like holding a hot potato aye.

SUM, MET and RYM are really killing my vibe right now!

[JeremyALD]

Hi guys do you think its a good time to sell? Im thinking about putting it towards my mortgage? would be around 50k total.
Thanks

Well the NZX is at a record high so its not a bad time to sell but the NZ economy is looking good and global markets are strong so is it the best? Who knows, but do what's best for you. Paying down your mortgage is never a bad thing IMO.

[Hoop]

Hi guys do you think its a good time to sell? Im thinking about putting it towards my mortgage? would be around 50k total.
Thanks

Well the NZX is at a record high so its not a bad time to sell but the NZ economy is looking good and global markets are strong so is it the best? Who knows, but do what's best for you. Paying down your mortgage is never a bad thing IMO.

Depends on the stocks...there's a rule of thumb for investors (slightly bias towards the buy & hold long term discipline) "Cut your losses and let your profits run"..For some of us that are short/medium termers or the TAer's variable termers that rule of thumb applies only when the stock is in an uptrend as we profit take when the trend reverses down...What I'm saying here is ..How would you feel if the stock you sold went up another 30% (cap $65,000)..if you can live with that then pay down your mortgage..

Why am I in favour of paying off the mortgage?

More than 15 years ago with higher interest rates..I would've said don't pay down the mortgage now I say we have low interest rates so pay down your mortgage... a layman's paradox..eh.....I'll leave that to you to figure why it's so...
Hint: - All to do with Theory, and little help from math.
Another hint: - Low/zero inflation puts zero pressure on house prices so increasing prices is a real overvaluing action (intrinsic value< market value)...increases market risks.
Another hint: - high inflation devalues mortgages over time...deflation increases the value of debt over time..

History tells us high or low inflation are long term period events so low inflation could around for another decade...

[bull....]

8100 im thinking from consolidation breakout

[bull....]

today might not be so good thanks to fbu

[Jay]

Pity the ASX cannot keep up!

[value_investor]

The first six months have been nothing short of stellar. With reporting season coming up, I wonder how the market will hold up come year end. Considering that a lot of shares are overpriced, there might be a slight correction going forward OR it could just be more of the same if the reports hold up to meet the expectation or even exceed that. Time will tell..

[bull....]

The first six months have been nothing short of stellar. With reporting season coming up, I wonder how the market will hold up come year end. Considering that a lot of shares are overpriced, there might be a slight correction going forward OR it could just be more of the same if the reports hold up to meet the expectation or even exceed that. Time will tell..

follow the overseas markets will help give you clue

[cdonald]

is there any way to find out which stocks are included in the nzx50 and which ones are borderline ones

[Hoop]

is there any way to find out which stocks are included in the nzx50 and which ones are borderline ones

The top 10 are here (http://smartshares.co.nz/types-of-funds/smartlarge/fnz)and the other 40 are here (mid-caps) (https://www.nzx.com/companies/MDZ/announcements/304208) ..There is a measure for rebalancing and that methodology change takes effect on 8th September....when the rebalancing of the NZx50 occurs backdated to the last Friday of August (updated methodology..end date change)....The methodology is not entirely reliant on the market value of the company but its close...so the top 50 Mkt cap value of companies at close on the last friday of August may give you an approximate clue....

Ive based my assumptions on the Mkt Caps with my quote from from Messenger on the 19th July (saves typing it out again:) ) ".....Ok.....I've had a look.....Rough eyeball calc says if prices say around this area between now to the end of August......This could happen The top 10 Trademe out SKC out AIR in Zero in...so some pricing may move with the insto rebalances............The NZX50 (and Midcaps)..CVT out Investore out NZX out Tegel in PPH in T&G in.....

[cdonald]

thanks for that hoops

[winner69]

thanks for that hoops

If you want a good telling off cdonald I dare you to ring the NZX and ask for a listing.

If you use a broker and nice to them they'll probably give you the secret list.

[bull....]

8100 im thinking from consolidation breakout

tracking up nicely

[Hoop]

For us Plebs it not long to wait now to see who's in and who's out

[bull....]

tracking nicely to our 8100 target ( the target from the breakout ) market still looks cheap in places and govt anouncement might get us across the line.

[ratkin]

It is a bit of a worry when the success of the market is all over the news. Sure sign it overpriced and toppy

[couta1]

It is a bit of a worry when the success of the market is all over the news. Sure sign it overpriced and toppy It's only a handful of stocks like A2 and Xro that are making it look toppy IMO. There are still quite a few stocks that are on a reasonable PE whose prices haven't increased much over the last year .

[bull....]

It's only a handful of stocks like A2 and Xro that are making it look toppy IMO. There are still quite a few stocks that are on a reasonable PE whose prices haven't increased much over the last year .

yea agree, plenty of under performing stocks around that still make good money but havent performed relative to the market

[value_investor]

8100 and climbing?!

As crazy as it sounds it could be higher right now than it is. Its being propped up at the moment by the performance of the likes of ATM and AIR but others that have high weighing haven't had stellar runs this year. AIA and FBU have been below average the past 12 months while shares like RYM and SPK have under performed to perhaps where they should have.

No end in sight to the bull market, the interesting thing will be if the earnings results will keep up with forward PE's in 2018..

[bull....]

8100 and climbing?!

As crazy as it sounds it could be higher right now than it is. Its being propped up at the moment by the performance of the likes of ATM and AIR but others that have high weighing haven't had stellar runs this year. AIA and FBU have been below average the past 12 months while shares like RYM and SPK have under performed to perhaps where they should have.

No end in sight to the bull market, the interesting thing will be if the earnings results will keep up with forward PE's in 2018..

reached the 8100 target:t_up: agree it was reached because of a few stocks out performing , see what happens now , i see s$P500 is consolidating in the target range mentioned on the black monday thread but still looks very bullish and i was reading the other day most strategist and fund managers are underperforming indexs as most didnt believe it would be this high so that could lead to a very bullish 4th quarter?.

[Valuegrowth]

It is time go behind overlooked value stocks. Most stocks are topping up. Market may hit even 8200 but there is a risk of falling currently high riding stocks sooner than later. When that happens index also will fall.I am bearish on on extended stocks but still I have faith on great value stocks and attractive defensive stocks.

[bull....]

looks like a its short termed topped out around our 8100 target that was reached, have to wait see what happens from here

[bull....]

didnt rest long at 8100, but i guess that was no surprise really still looks pretty cheap in relation to the outlook for interest rates

hoping for another 20% next year

[Valuegrowth]

It may drop below 7000 by the end of 2018.

https://www.msn.com/en-us/finance/news/wise-investors-are-already-planning-for-the-next-bear-market/ar-BBHqvbu (https://www.msn.com/en-us/finance/news/wise-investors-are-already-planning-for-the-next-bear-market/ar-BBHqvbu)

Wise Investors Are Already Planning for the Next Bear Market

[bull....]

So much for the excitement of last year contining this year so far , the double top at 8400 holds so far and most metrics look negative technically at this time , throw in the fundamantals of possibly higher bond rates and inflation and us money withdrawl and it could make for a grind down going forward. who knows guess we will follow the whim of wall st at the end of the day.

[bull....]

wall st hammer time , wonder if nzx will be hammered today as well .... not that good a report season so far