Bay of Plenty Times
  • Bay of Plenty Times home
  • Latest news
  • Business
  • Opinion
  • Lifestyle
  • Property
  • Sport
  • Video
  • Death notices
  • Classifieds

Subscriptions

  • Herald Premium
  • Viva Premium
  • The Listener
  • BusinessDesk

Sections

  • Latest news
  • On The Up
  • Business
  • Opinion
  • Lifestyle
  • Property
    • All Property
    • Residential property listings
  • Rural
    • All Rural
    • Dairy farming
    • Sheep & beef farming
    • Horticulture
    • Animal health
    • Rural business
    • Rural life
    • Rural technology
  • Sport

Locations

  • Coromandel & Hauraki
  • Katikati
  • Tauranga
  • Mount Maunganui
  • Pāpāmoa
  • Te Puke
  • Whakatāne
  • Rotorua

Media

  • Video
  • Photo galleries
  • Today's Paper - E-Editions
  • Photo sales
  • Classifieds

Weather

  • Thames
  • Tauranga
  • Whakatāne
  • Rotorua

NZME Network

  • Advertise with NZME
  • OneRoof
  • Driven Car Guide
  • BusinessDesk
  • Newstalk ZB
  • Sunlive
  • ZM
  • The Hits
  • Coast
  • Radio Hauraki
  • The Alternative Commentary Collective
  • Gold
  • Flava
  • iHeart Radio
  • Hokonui
  • Radio Wanaka
  • iHeartCountry New Zealand
  • Restaurant Hub
  • NZME Events

SubscribeSign In
Advertisement
Advertise with NZME.
Home / Bay of Plenty Times

Mark Lister: Does a better second half beckon?

Bay of Plenty Times
9 Jul, 2022 01:00 AM4 mins to read

Subscribe to listen

Access to Herald Premium articles require a Premium subscription. Subscribe now to listen.
Already a subscriber?  Sign in here

Listening to articles is free for open-access content—explore other articles or learn more about text-to-speech.
‌
Save

    Share this article

    Reminder, this is a Premium article and requires a subscription to read.

Mark Lister says many investors will be happy the first half of 2022 is behind us. Photo / Getty Images

Mark Lister says many investors will be happy the first half of 2022 is behind us. Photo / Getty Images

COMMENT:

Many investors will be happy the first half of 2022 is behind us. With the exception of commodities, most asset classes suffered heavy declines.

The S&P 500 in the US fell 20.6 per cent, which is the worst first six months of a calendar year since 1970. Having said that, when a lower NZ dollar is accounted for this becomes a more modest 13.2 per cent fall.

In New Zealand, the NZX 50 declined 16.6 per cent. That's the worst performance in a six-month period since 2008 when we were smack in the middle of the GFC.

Even conservative assets declined, with New Zealand corporate bonds down 4.3 per cent.

Advertisement
Advertise with NZME.

According to Deutsche Bank research, US 10-year Treasury bonds recorded their worst first half since 1788, just before George Washington became President!

The Real Estate Institute's house price index for Auckland is down almost 12 per cent in the last six months, while cryptocurrencies have plunged almost 70 per cent so far in 2022.

Rising interest rates have been a key reason for such volatility, as policymakers around the world attempt to withdraw the stimulus of recent years.

Advertisement
Advertise with NZME.

That normalisation was always on the cards, but higher than expected inflation has seen investors rapidly rethink expectations for the speed of the process.

Mark Lister is Head of Private Wealth Research at Craigs Investment Partners. Photo / Supplied
Mark Lister is Head of Private Wealth Research at Craigs Investment Partners. Photo / Supplied

At the beginning of the year, financial markets were expecting the Official Cash Rate (OCR) to finish the year at 2.25 per cent. It's 2 per cent today and by Christmas, it's expected to be approaching 4 per cent.

Discover more

Business

Mark Lister: Is debt helpful, or a handbrake?

01 Jul 11:00 PM
Business

Mark Lister: Are we headed for recession?

25 Jun 01:00 AM
Business

Mark Lister: How does Jerome Powell want to be remembered?

18 Jun 01:32 AM
Business

Mark Lister: What should you look for in a stock?

11 Jun 07:35 PM

In the US, we started the year with markets expecting the Fed's policy rate to finish 2022 at 0.75 per cent. It was already beyond that by early May, and it's expected to end the year higher than 3 per cent.

If I had to guess, I'd say there is more volatility to come. At the same time, I suspect we're past the worst and I'm not expecting a repeat of the first half during these next six months.

There are early signs of inflation peaking, with commodity prices off their highs, demand softening and indications of supply bottlenecks easing.

That won't stop the interest rate hikes, mind you. Our Reserve Bank will push through another increase next week, while many other parts of the world are still playing catch-up.

The upcoming earnings season will be important for the direction of sharemarkets, and it will help gauge the impact of higher borrowing costs, lower confidence and slowing activity on margins, profitability and dividends.

US companies will begin reporting earnings late next week, starting with the big banks, while August will be a crucial period for the corporate sector across New Zealand and Australia.

Advertisement
Advertise with NZME.

The good news, and there definitely is some, is that many asset classes look better value than they have for some time.

US shares ended June a little more than 20 per cent below their January peak. Historically, investing when markets are down as much as this has proved a lucrative strategy.

I looked back at all the months since 1950 the S&P 500 closed more than 20 per cent down from a recent peak. Buying at those times yielded a positive return over the following two years on 89 per cent of occasions, and the average gain was 28 per cent.

While some investors will be lamenting their lower Kiwisaver balances and negative returns, those with a long-term perspective should be rubbing their hands, and even hoping for more weakness.

Mark Lister is Head of Private Wealth Research at Craigs Investment Partners. The information in this article is provided for information only, is intended to be general in nature, and does not take into account your financial situation, objectives, goals, or risk tolerance. Before making any investment decision Craigs Investment Partners recommends you contact an investment adviser.

Save

    Share this article

    Reminder, this is a Premium article and requires a subscription to read.

Latest from Bay of Plenty Times

Bay of Plenty Times

Rugby showdown: Local teams gear up for Baywide semis

09 Jul 06:00 AM
Bay of Plenty Times

Rain train: Weather watches keep rolling in for Bay of Plenty

09 Jul 01:32 AM
Bay of Plenty Times

'I wasn't prepared to wait': Youngest Govt MP on seizing his big opportunity

09 Jul 12:26 AM

From early mornings to easy living

sponsored
Advertisement
Advertise with NZME.

Latest from Bay of Plenty Times

Rugby showdown: Local teams gear up for Baywide semis

Rugby showdown: Local teams gear up for Baywide semis

09 Jul 06:00 AM

Whakarewarewa dominated Te Puna with a 57-10 win in Rotorua.

Rain train: Weather watches keep rolling in for Bay of Plenty

Rain train: Weather watches keep rolling in for Bay of Plenty

09 Jul 01:32 AM
'I wasn't prepared to wait': Youngest Govt MP on seizing his big opportunity

'I wasn't prepared to wait': Youngest Govt MP on seizing his big opportunity

09 Jul 12:26 AM
'Ecstatic' reunion: Cat found after year-long disappearance

'Ecstatic' reunion: Cat found after year-long disappearance

09 Jul 12:00 AM
Solar bat monitors uncover secrets of Auckland’s night sky
sponsored

Solar bat monitors uncover secrets of Auckland’s night sky

NZ Herald
  • About NZ Herald
  • Meet the journalists
  • Newsletters
  • Classifieds
  • Help & support
  • Contact us
  • House rules
  • Privacy Policy
  • Terms of use
  • Competition terms & conditions
  • Our use of AI
Subscriber Services
  • Bay of Plenty Times e-edition
  • Manage your print subscription
  • Manage your digital subscription
  • Subscribe to Herald Premium
  • Subscribe to the Bay of Plenty Times
  • Gift a subscription
  • Subscriber FAQs
  • Subscription terms & conditions
  • Promotions and subscriber benefits
NZME Network
  • Bay of Plenty Times
  • The New Zealand Herald
  • The Northland Age
  • The Northern Advocate
  • Waikato Herald
  • Rotorua Daily Post
  • Hawke's Bay Today
  • Whanganui Chronicle
  • Viva
  • NZ Listener
  • Newstalk ZB
  • BusinessDesk
  • OneRoof
  • Driven Car Guide
  • iHeart Radio
  • Restaurant Hub
NZME
  • About NZME
  • NZME careers
  • Advertise with NZME
  • Digital self-service advertising
  • Book your classified ad
  • Photo sales
  • NZME Events
  • © Copyright 2025 NZME Publishing Limited
TOP