NZ Herald
  • Home
  • Latest news
  • Video
  • New Zealand
  • Sport
  • World
  • Business
  • Entertainment
  • Podcasts
  • Quizzes
  • Opinion
  • Lifestyle
  • Travel
  • Viva
  • Weather forecasts

Subscriptions

  • Herald Premium
  • Viva Premium
  • The Listener
  • BusinessDesk

Sections

  • Latest news
  • New Zealand
    • All New Zealand
    • Crime
    • Politics
    • Education
    • Open Justice
    • Scam Update
  • Budget 2025
  • On The Up
  • World
    • All World
    • Australia
    • Asia
    • UK
    • United States
    • Middle East
    • Europe
    • Pacific
  • Business
    • All Business
    • MarketsSharesCurrencyCommoditiesStock TakesCrypto
    • Markets with Madison
    • Media Insider
    • Business analysis
    • Personal financeKiwiSaverInterest ratesTaxInvestment
    • EconomyInflationGDPOfficial cash rateEmployment
    • Small business
    • Business reportsMood of the BoardroomProject AucklandSustainable business and financeCapital markets reportAgribusiness reportInfrastructure reportDynamic business
    • Deloitte Top 200 Awards
    • CompaniesAged CareAgribusinessAirlinesBanking and financeConstructionEnergyFreight and logisticsHealthcareManufacturingMedia and MarketingRetailTelecommunicationsTourism
  • Opinion
    • All Opinion
    • Analysis
    • Editorials
    • Business analysis
    • Premium opinion
    • Letters to the editor
  • Sport
    • All Sport
    • OlympicsParalympics
    • RugbySuper RugbyNPCAll BlacksBlack FernsRugby sevensSchool rugby
    • CricketBlack CapsWhite Ferns
    • Racing
    • NetballSilver Ferns
    • LeagueWarriorsNRL
    • FootballWellington PhoenixAuckland FCAll WhitesFootball FernsEnglish Premier League
    • GolfNZ Open
    • MotorsportFormula 1
    • Boxing
    • UFC
    • BasketballNBABreakersTall BlacksTall Ferns
    • Tennis
    • Cycling
    • Athletics
    • SailingAmerica's CupSailGP
    • Rowing
  • Lifestyle
    • All Lifestyle
    • Viva - Food, fashion & beauty
    • Society Insider
    • Royals
    • Sex & relationships
    • Food & drinkRecipesRecipe collectionsRestaurant reviewsRestaurant bookings
    • Health & wellbeing
    • Fashion & beauty
    • Pets & animals
    • The Selection - Shop the trendsShop fashionShop beautyShop entertainmentShop giftsShop home & living
    • Milford's Investing Place
  • Entertainment
    • All Entertainment
    • TV
    • MoviesMovie reviews
    • MusicMusic reviews
    • BooksBook reviews
    • Culture
    • ReviewsBook reviewsMovie reviewsMusic reviewsRestaurant reviews
  • Travel
    • All Travel
    • News
    • New ZealandNorthlandAucklandWellingtonCanterburyOtago / QueenstownNelson-TasmanBest NZ beaches
    • International travelAustraliaPacific IslandsEuropeUKUSAAfricaAsia
    • Rail holidays
    • Cruise holidays
    • Ski holidays
    • Luxury travel
    • Adventure travel
  • Kāhu Māori news
  • Environment
    • All Environment
    • Our Green Future
  • Talanoa Pacific news
  • Property
    • All Property
    • Property Insider
    • Interest rates tracker
    • Residential property listings
    • Commercial property listings
  • Health
  • Technology
    • All Technology
    • AI
    • Social media
  • Rural
    • All Rural
    • Dairy farming
    • Sheep & beef farming
    • Horticulture
    • Animal health
    • Rural business
    • Rural life
    • Rural technology
    • Opinion
    • Audio & podcasts
  • Weather forecasts
    • All Weather forecasts
    • Kaitaia
    • Whangārei
    • Dargaville
    • Auckland
    • Thames
    • Tauranga
    • Hamilton
    • Whakatāne
    • Rotorua
    • Tokoroa
    • Te Kuiti
    • Taumaranui
    • Taupō
    • Gisborne
    • New Plymouth
    • Napier
    • Hastings
    • Dannevirke
    • Whanganui
    • Palmerston North
    • Levin
    • Paraparaumu
    • Masterton
    • Wellington
    • Motueka
    • Nelson
    • Blenheim
    • Westport
    • Reefton
    • Kaikōura
    • Greymouth
    • Hokitika
    • Christchurch
    • Ashburton
    • Timaru
    • Wānaka
    • Oamaru
    • Queenstown
    • Dunedin
    • Gore
    • Invercargill
  • Meet the journalists
  • Promotions & competitions
  • OneRoof property listings
  • Driven car news

Puzzles & Quizzes

  • Puzzles
    • All Puzzles
    • Sudoku
    • Code Cracker
    • Crosswords
    • Cryptic crossword
    • Wordsearch
  • Quizzes
    • All Quizzes
    • Morning quiz
    • Afternoon quiz
    • Sports quiz

Regions

  • Northland
    • All Northland
    • Far North
    • Kaitaia
    • Kerikeri
    • Kaikohe
    • Bay of Islands
    • Whangarei
    • Dargaville
    • Kaipara
    • Mangawhai
  • Auckland
  • Waikato
    • All Waikato
    • Hamilton
    • Coromandel & Hauraki
    • Matamata & Piako
    • Cambridge
    • Te Awamutu
    • Tokoroa & South Waikato
    • Taupō & Tūrangi
  • Bay of Plenty
    • All Bay of Plenty
    • Katikati
    • Tauranga
    • Mount Maunganui
    • Pāpāmoa
    • Te Puke
    • Whakatāne
  • Rotorua
  • Hawke's Bay
    • All Hawke's Bay
    • Napier
    • Hastings
    • Havelock North
    • Central Hawke's Bay
    • Wairoa
  • Taranaki
    • All Taranaki
    • Stratford
    • New Plymouth
    • Hāwera
  • Manawatū - Whanganui
    • All Manawatū - Whanganui
    • Whanganui
    • Palmerston North
    • Manawatū
    • Tararua
    • Horowhenua
  • Wellington
    • All Wellington
    • Kapiti
    • Wairarapa
    • Upper Hutt
    • Lower Hutt
  • Nelson & Tasman
    • All Nelson & Tasman
    • Motueka
    • Nelson
    • Tasman
  • Marlborough
  • West Coast
  • Canterbury
    • All Canterbury
    • Kaikōura
    • Christchurch
    • Ashburton
    • Timaru
  • Otago
    • All Otago
    • Oamaru
    • Dunedin
    • Balclutha
    • Alexandra
    • Queenstown
    • Wanaka
  • Southland
    • All Southland
    • Invercargill
    • Gore
    • Stewart Island
  • Gisborne

Media

  • Video
    • All Video
    • NZ news video
    • Business news video
    • Politics news video
    • Sport video
    • World news video
    • Lifestyle video
    • Entertainment video
    • Travel video
    • Markets with Madison
    • Kea Kids news
  • Podcasts
    • All Podcasts
    • The Front Page
    • On the Tiles
    • Ask me Anything
    • The Little Things
    • Cooking the Books
  • Cartoons
  • Photo galleries
  • Today's Paper - E-editions
  • Photo sales
  • Classifieds

NZME Network

  • Advertise with NZME
  • OneRoof
  • Driven Car Guide
  • BusinessDesk
  • Newstalk ZB
  • What the Actual
  • 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 / Business / Companies

Nervous days ahead for investors

Bloomberg
24 Jan, 2010 03:00 PM4 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

The New Zealand sharemarket opens today facing a fresh round of jitters after Wall St slumped 5.1 per cent in the three days to end the week - the biggest decline for the S&P 500 since it sank to a 12-year low in March.

The S&P 500 erased its 2010 gain, retreating 3.9 per cent for the full week as banks plunged on a White House proposal to limit financial risk and China moved to cool economic growth.

"It's a one-two punch," said Ralph Fogel, head of investment strategy at Fogel Neale Partners in New York, of the curbs on Chinese growth and Wall St firms.

"In the end it's going to have the same impact - less flow of money into the marketplace."

The VIX, an index of volatility known as Wall St's "fear gauge", jumped 55 per cent to 27.31 over the period, its largest gain since 2007.

Uncertainty over whether Federal Reserve chairman Ben Bernanke will win Senate confirmation for a second term beginning on February 1, even with Obama's backing, also undermined investor confidence, traders said.

The concern rippled into other markets, pushing the benchmark MSCI Asia Pacific Index, which includes the New Zealand stock exchange, into its biggest weekly drop since March.

"It does look like we're going through some sort of a correction," said Shane Oliver, head of investment strategy in Sydney at AMP Capital Investors, which oversees about US$90 billion ($126 billion) globally.

"There are some worries about the extent of tightening in China. I don't think they're seeking to crunch their economy, but obviously the market worries that that will be the case."

The People's Bank of China unexpectedly raised lenders' reserve requirements to curb liquidity.

It will raise interest rates by the end of June, as well as increasing banks' reserve requirements.

"China has done the heavy lifting in the recovery process, and now needs to cool its economy down a little bit," said Prasad Patkar, at Platypus Asset Management in Sydney.

"Policy tightening measures will be forthcoming, but they need to be viewed in the context of how strong the economy has been."

Metal prices fell amid speculation China will restrict lending and raise borrowing costs to prevent the economy overheating.



The concern sent Australian mining stocks down and came on top of news reports that a review of Australia's tax system may recommend taxing mining projects in the same way as energy projects, a change that would have raised an extra A$14 billion ($12.7 billion) over the past three years.

Signs of a pick-up in economies around the region have driven the MSCI Asia Pacific up by almost 50 per cent in the past year.

Companies on the index are priced at an average 1.6 times book value, near the highest level since September 2008.

"The market remains overheated and there will be some more corrections," said Mitsushige Akino, at Ichiyoshi Investment Management in Tokyo.

But one senior Chinese Government economist said it was too soon for China to raise interest rates because inflation was still containable and a rate hike could spur an unwelcome influx of speculative money.

Xia Bin, head of the financial institute of the Development Research Centre, a Cabinet thinktank, said China's economy could maintain relatively rapid growth of at least 8 per cent this year and keep consumer price inflation down to about 3 per cent, the official China Securities Journal reported.

Xia warned that if China raised interest rates before the United States did, it might attract inflows of "hot money" while the consumer price index was still within a range where it could be kept under control.

Data released late last week showed China's economy grew 10.7 per cent in the fourth quarter from a year earlier while the December CPI jumped 1.9 per cent year-on-year, accelerating from November's 0.6 per cent rise.

- BLOOMBERG

Advertisement
Advertise with NZME.
Advertisement
Advertise with NZME.
Save

    Share this article

Latest from Companies

Banking and finance

Andrew Barclay to leave Goldman Sachs NZ

20 May 03:24 AM
Premium
Technology

Callaghan shows start-up team the door, Auckland Mayor makes tech grab

20 May 03:01 AM
Crime

NZ's largest corporate corruption case: How two Australians duped Spark with $20m in contracts

20 May 02:21 AM

The Hire A Hubby hero turning handyman stereotypes on their head

sponsored
Advertisement
Advertise with NZME.

Latest from Companies

Andrew Barclay to leave Goldman Sachs NZ

Andrew Barclay to leave Goldman Sachs NZ

20 May 03:24 AM

Barclay has been one of New Zealand's most respected deal-makers.

Premium
Callaghan shows start-up team the door, Auckland Mayor makes tech grab

Callaghan shows start-up team the door, Auckland Mayor makes tech grab

20 May 03:01 AM
NZ's largest corporate corruption case: How two Australians duped Spark with $20m in contracts

NZ's largest corporate corruption case: How two Australians duped Spark with $20m in contracts

20 May 02:21 AM
Premium
Rich-lister wants to demolish iconic Auckland boatshed

Rich-lister wants to demolish iconic Auckland boatshed

19 May 10:30 PM
Gold demand soars amid global turmoil
sponsored

Gold demand soars amid global turmoil

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
  • NZ Herald e-editions
  • Daily puzzles & quizzes
  • Manage your digital subscription
  • Manage your print subscription
  • Subscribe to the NZ Herald newspaper
  • Subscribe to Herald Premium
  • Gift a subscription
  • Subscriber FAQs
  • Subscription terms & conditions
  • Promotions and subscriber benefits
NZME Network
  • The New Zealand Herald
  • The Northland Age
  • The Northern Advocate
  • Waikato Herald
  • Bay of Plenty Times
  • Rotorua Daily Post
  • Hawke's Bay Today
  • Whanganui Chronicle
  • Viva
  • NZ Listener
  • What the Actual
  • Newstalk ZB
  • BusinessDesk
  • OneRoof
  • Driven CarGuide
  • 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