Summary

  • S&P/NZX 50 index has staged a sharp recovery from the March stock market crash, delivering a return of over 38 per cent.
  • Remarkably high levels of trading activity and strong international interest in the Kiwi share market has stimulated the recovery of NZ benchmark index.
  • With interest rates still prevailing at record low levels, the NZ share market is potentially emerging as a lucrative opportunity for individuals seeking alternative investment alternatives.
  • Popular NZX-listed stocks, which delivered decent returns since the March crash, deserve a closer look for your September 2020 watchlist.
  • Judicious fundamental research of the firms and the industries to which these stocks belong seem vital to build virus-immune portfolio.

While the COVID-19 pandemic initially triggered massive sell-off in the NZ equity market, the NZX 50 index has staged a sharp recovery from the March stock market crash.

The NZ equity market has recouped much of the 2020 bear market losses, leaving the experts in awe. Interestingly, some NZX-listed stocks are gleaming as a promising investment opportunity in the post-COVID era.

Outperforming several major global indices, the S&P/NZX 50 index has stayed relatively resilient during coronavirus-induced market turmoil. The index has generated a return of about 40 per cent since March 2020 dip, backed by remarkably high levels of activity and strong international interest in the Kiwi share market.

As per the NZX stats, the first six months of 2020 saw daily number of trades soaring to ~48,000 in NZX market, with value traded setting new records at ~NZD 28 billion (52.3 per cent up on pcp) in 1H 2020. An unprecedented lift in share trading, increased retail investor participation and an upsurge in capital raisings helped boost NZX’s profit to NZD 9.1 million in 1H 2020, marking a rise of 40.9 per cent on 1H 2019.

Interesting Read! NZX Turns Saviour in COVID-19 Crisis, Marks a Phenomenal Half-Year of Capital Raisings

With interest rates still prevailing at record low levels, the NZ share market is potentially emerging as a lucrative opportunity for individuals seeking alternative investment alternatives.

With that said, let us acquaint you with ten popular stocks trading on NZX platform, that deserve a spot on your September 2020 watchlist:

In addition to delivering decent returns since March 2020 crash, these stocks also seem to be reasonably positioned in terms of their operational and financial footing, as demonstrated in the table below:

While an upbeat has been spotted in the above-listed stocks in reviving from March 2020 crash, investors need to make a conscious decision, with a mix of fundamental and technical approach.

Sound fundamental research of the firms and the industries to which these stocks belong seem vital to build virus-proof portfolio. For instance, some of the recession-proof themes include players in disruptive, healthcare, e-commerce and technology space.

Moreover, one needs to decisively handpick stocks, taking multiple factors into consideration, including long-term sustainable profits, positive operating cash flows, durable competitive advantages and robust balance sheets.

To reap the rewards of potential market-crushing returns in the long run, one must avert indulging in short term trading strategies with a futile methodology to time price trends.

All in all, being selective and having greater clarity on investments with a profound understanding of markets seem crucial to capitalise on potential investment opportunities. Evaluating risk appetite while assessing opportunities in recovery-driven spaces and safe havens come to the crunch to wade through the market turmoil.

Do Not Miss! Three Unique Investment Tips to Build Recession-Proof Portfolio in COVID-19 Crisis

 

 


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