New Zealand stock exchange returns are topping the world - and resoundingly thrashing the ASX 200 across the Tasman.
As we approach the mid-point of the year, the NZX 50 has hit another record high breaking through the 9000 point barrier on Friday.
For the year to date, the NZX 50 gross index is now up more than seven per cent, a remarkable performance considering February's global market plunge.
"That's best in the world," said Harbour Asset Management research analyst Shane Solly.
It compares with returns of about 5 per cent for the Wall Street's S&P500, 3.4 per cent for the Euro Stoxx 50 and a paltry 1.04 per cent for the ASX 200.
After some post-election uncertainty late last year the NZX 50 appears to be back in favour with international investors, Solly said.
"People have gotten comfortable that new Government is not rocking the boat," Solly said.
This was against a backdrop of relatively low business confidence, he said.
But it was important to keep that in context as there had been a global slowing of growth in the past few months.
So when investors looked around the world for a market that was still growing, where they could have comfort in the underlying businesses and economy, New Zealand was standing out.
"I think we've actually been re-discovered. There were a few folks who parked us late last year but in the last few weeks we've seen a lot more global investor interest," he said.
"Why do we know that? Because what's performing and going up are the stocks in the MSCI index."
The MSCI (Morgan Stanley Capital Index) indexes are used by global fund managers to track the largest stocks in various regional markets.
When you combined that trend with the lack of new issues coming on the local market it was really creating some demand pressure, Solly said.
"The money keeps flowing, we have a pool that is quite substantial now and we'll get another injection of new capital come the start of the new quarter, so it's actually a very tight market."
There was also a disconnect between the business confidence surveys and the local stock exchange because the NZX was not a particularly good reflection of the wider business community, he said.
"If there's a change in the economy favouring the government sector then that does have an impost on some businesses more than others. We are watching that," Solly said.
"But when we think about the New Zealand market it is not connected, to the degree that some people think, to the New Zealand economy."
Broadly, the transition to higher interest rates was also going smoothly which was underpinning global markets.
The US Fed had raised rates again with minimal market reaction, the European Central Bank had taken a dovish approach, as had the Bank of Japan.
"That's a triple play of central banks talking about continuing to move policy but not talking about having to deal rapidly with an inflation problem."
So the fundamentals were there to continue supporting the market and keep it in positive territory, Solly said.
But maintaining the annual returns of 15 per cent we had seen for the past five years would get more difficult.
"What we do know is that when markets get to full valuation versus history, they tend to deliver lower returns."