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S&P 500 rises towards highs, but tech has a long way to go, AMP's workplace fund passes the $1 bill mark, More warnings from Bollard

Monday, November 20th 2006, 7:06AM
The price of the S&P 500 last week breached the 1400 plateau for the first time since November 10, 2000, marking a slow but steady rise for the world's most followed index.

The last time the index closed above 1400 was November 9, 2000 – more than six years ago.

"Overall, 71% of the S&P 500 issues have recovered from their October 2002 lows," Standard and Poor’s senior index analyst Howard Silverblatt says.

"In addition, 8 of the 10 sectors have posted a full recovery from the index's March 2000 high, with only Information Technology and Telecommunications lagging behind. Only 17% of the issues within those two sectors have fully recovered."

The S&P 500's highest close was set on March 24, 2000 when it finished the trading day at 1527. It then sharply declined until October 9, 2002 where it bottomed out at 776, representing a 49.1% drop in price value. From that point on the market has made a slow, but steady recovery, posting an 80.4% gain to date.

Standard & Poor's data shows that for the S&P 500 to break its all-time high, it would need to post a return from today of another 10.9%. "In addition, while Tech is up 109% from its October 2002 lows, it still needs another 171% just to match its high from six and half years ago," Silverblatt says.

AMP's workplace fund reaches $1 bill


AMP workplace savings fund, NZRT has cracked through the $1 billion mark, the company says. The scheme, which started in 1995, provides superannuation for around 32,000 employees at nearly 800 participating businesses.

“The scheme received a significant boost when the state sector joined,” AMP’s General Manager of Savings and Investments, Roger Perry says.

The scheme provides access to external funds and it has automatic age-related risk and returns adjustment through AMP’s Lifesteps programme.

“As KiwiSaver looms we’re seeing a turnaround in New Zealanders’ attitudes to savings.

Workplace savings schemes are now seen as integral to a well designed savings environment and incentives to encourage savings, a taboo topic even 2 or 3 years ago, is now actively debated.”

Another warning from Bollard
Reserve Bank governor has again said that New Zealanders need to have more share investments and less property.

“New Zealanders' low investment in local businesses leaves the economy more vulnerable to shocks and constrains the country's growth prospects,” he said.

Holdings of equity by New Zealand households are particularly low by OECD standards, with direct holdings of both domestic and foreign equities making up no more than about 4% of total assets. New Zealanders, he says, have “spent heavily on investor housing – houses and apartments beyond their own homes - investments stimulated by expectations of exciting capital gains rather than exciting rental yields."

This exposure to housing is being financed by increased mortgage debt from the banking system.

"The typical household now commits about 13 percent of its disposable income to service debt. This makes these households much more vulnerable than they used to be to adverse events, such as increases in unemployment and rising interest rates. These debt servicing rates are significantly higher than in other OECD countries."

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Lender Flt 1yr 2yr 3yr
AIA - Back My Build 6.19 - - -
AIA - Go Home Loans 8.74 7.24 6.75 6.65
ANZ 8.64 7.84 7.39 7.25
ANZ Blueprint to Build 7.39 - - -
ANZ Good Energy - - - 1.00
ANZ Special - 7.24 6.79 6.65
ASB Bank 8.64 7.24 6.75 6.65
ASB Better Homes Top Up - - - 1.00
Avanti Finance 9.15 - - -
Basecorp Finance 9.60 - - -
Bluestone 9.24 - - -
Lender Flt 1yr 2yr 3yr
BNZ - Classic - 7.24 6.79 6.65
BNZ - Green Home Loan top-ups - - - 1.00
BNZ - Mortgage One 8.69 - - -
BNZ - Rapid Repay 8.69 - - -
BNZ - Std, FlyBuys 8.69 7.84 7.39 7.25
BNZ - TotalMoney 8.69 - - -
CFML Loans 9.45 - - -
China Construction Bank - 7.09 6.75 6.49
China Construction Bank Special - - - -
Co-operative Bank - First Home Special - 7.04 - -
Co-operative Bank - Owner Occ 8.40 7.24 6.79 6.65
Lender Flt 1yr 2yr 3yr
Co-operative Bank - Standard 8.40 7.74 7.29 7.15
Credit Union Auckland 7.70 - - -
First Credit Union Special - 7.45 7.35 -
First Credit Union Standard 8.50 7.99 7.85 -
Heartland Bank - Online 7.99 6.69 6.45 6.19
Heartland Bank - Reverse Mortgage - - - -
Heretaunga Building Society 8.90 7.60 7.40 -
HSBC Premier 8.59 - - -
HSBC Premier LVR > 80% - - - -
HSBC Special - - - -
ICBC 7.85 7.05 6.75 6.59
Lender Flt 1yr 2yr 3yr
Kainga Ora 8.64 7.79 7.39 7.25
Kainga Ora - First Home Buyer Special - - - -
Kiwibank 8.50 8.25 7.79 7.55
Kiwibank - Offset 8.50 - - -
Kiwibank Special - 7.25 6.79 6.65
Liberty 8.59 8.69 8.79 8.94
Nelson Building Society 9.00 7.75 7.35 -
Pepper Money Advantage 10.49 - - -
Pepper Money Easy 8.69 - - -
Pepper Money Essential 8.29 - - -
Resimac - LVR < 80% 8.84 8.09 7.59 7.29
Lender Flt 1yr 2yr 3yr
Resimac - LVR < 90% 9.84 9.09 8.59 8.29
Resimac - Specialist Clear (Alt Doc) - - 8.99 -
Resimac - Specialist Clear (Full Doc) - - 9.49 -
SBS Bank 8.74 7.84 7.45 7.25
SBS Bank Special - 7.24 6.85 6.65
SBS Construction lending for FHB - - - -
SBS FirstHome Combo 6.19 6.74 - -
SBS FirstHome Combo - - - -
SBS Unwind reverse equity 9.95 - - -
Select Home Loans 9.24 - - -
TSB Bank 9.44 8.04 7.55 7.45
Lender Flt 1yr 2yr 3yr
TSB Special 8.64 7.24 6.75 6.65
Unity 8.64 6.99 6.79 -
Unity First Home Buyer special - - 6.45 -
Wairarapa Building Society 8.60 6.95 6.85 -
Westpac 8.64 7.89 7.35 7.25
Westpac Choices Everyday 8.74 - - -
Westpac Offset 8.64 - - -
Westpac Special - 7.29 6.75 6.65
Median 8.64 7.29 7.32 6.65

Last updated: 8 April 2024 9:21am

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