The NZX50 hit an all-time high yesterday as Asia-Pacific
investors shrugged off tensions about the future of Ukraine
which sent United States and European stocks into a spin.
Craigs Investment Partners said there was a recovery in the
New Zealand market which had been hardly dented by concerns
elsewhere in the world.
Gold and Oil prices rose as US investors bailed out of shares
and into safer securities.
The NZX50 rallied at the close on Monday to a record high but
lifted even further to reach 5040 points at 3pm before
closing at 5033.
The strength was not restricted to just one company or
sector, Mr Timms said.
Fisher and Paykel Healthcare, Air New Zealand, Auckland
International Airport and Sky Network TV were all up.
Asked if it meant New Zealand investors were selling up
overseas and buying locally-listed shares, Mr Timms believed
that was not the case.
''They would get a hiding on currency if they were bringing
investments home now. Investors would wait until our dollar
dropped in value before selling overseas.''
On Monday, US stocks fell sharply with the Dow Jones
Industrial Average dropping nearly 1%, and the broad-based
S&P and the technology rich Nasdaq both dropped about
The selling followed sharp losses in European equity markets.
''It's all about the flight to safety,'' Mr Timms said.
Asian and Australian markets were up, but not as much as the
CMC Markets chief market analyst Ric Spooner said the
Australian market was the first to move on Monday to news
that Ukraine was on the brink of war with Russia in a crisis
that began three months ago with civilian protests against
President Viktor Yanukovich.
On Monday, President Barack Obama warned the US was planning
economic and diplomatic sanctions to ''isolate'' Russia if it
did not reverse its incursion into Ukraine.
''Everything has taken a back seat . . . to Russia and the
potential impact for worldwide markets. The safest thing for
them to do is sell first and ask questions later,'' Mr Timms
Russia's intervention in Ukraine drove up crude oil and
prices for gold and government debt.
Crude prices rose more than $US2 ($NZ2.40) a barrel, gold
futures jumped 2% and prices of top-rated euro zone
government bonds rose.
Market volatility indices, a sign of investor
apprehensiveness, surged with the Euro Stoxx Volatility index
spiking at 30.4%, its largest one-day gain since 2011. The
United States CBOE volatility index surged 20% at one point,
and ended the session 14.5% higher.
Investors had underestimated the risks of an escalation in
Ukraine and the events over the weekend were a wake-up call
for the market, Global Equities quantitative sales trading
head David Thebault told Reuters.
The rouble traded off about 1.45% after earlier touching
record lows against the dollar and the euro.
The Russian central bank lifted its base lending rate by 1.5%
to 7% in an unscheduled meeting.
Traders estimated the Russian central bank sold more than
$US10 billion yesterday to prop up the rouble.