New Zealand Investors Confident Despite Latest Covid Scare, New Survey Shows
While the New Zealand-Australia travel bubble endured an immediate pause, over eight in ten investors remained confident in New Zealand’s capital markets, and are increasingly positive about international markets, new survey findings released today by Chartered Accountants Australia and New Zealand (CA ANZ) shows.
Undertaken 28-29 June 2021, the survey of 500 New Zealand retail investors found that confidence in both New Zealand capital markets (86%) and NZX-listed companies (86%) is greater than pre-pandemic levels.
The third of its kind, the annual CA ANZ Investor Confidence Survey saw confidence in capital markets sit at 85% in 2019 and 83% in 2020 and confidence in publicly listed companies at 83% in 2019 and 80% in 2020.
Investors with particularly high levels of confidence in the New Zealand market (47%) have rebounded even more with an 11% rise compared to 2020.
“Despite the uncertainty of COVID, investor confidence in the New Zealand share market has not dimmed,” said CA ANZ Reporting & Assurance Leader Amir Ghandar FCA.
“We saw a wobble in confidence levels in last year, which has now rebounded despite this survey being carried out after New Zealand experienced a COVID scare between Sydney and Wellington.
“The positive survey results show that investors are increasingly comfortable with more flexible travel, the associated risks, and the systems in place to mitigate them.
“Investor confidence was mainly buoyed by the belief that the New Zealand economy will recover well post COVID, that the NZX historically bounces back and confidence in New Zealand's productivity.
“Conversely, investors who remained wary are concerned about the ongoing impact of COVID lockdown measures, the government’s budget position and general economic malaise.
“Whether this rebound is short-lived or here for the long haul will be proven by how well we handle this crucial next year of the crisis, particularly as other global economies start to re-open.”
Investor confidence in international shares has bounced back even more decisively, said Ghandar.
“Around three quarters (77%) said they have confidence in capital markets outside of New Zealand, which is a 13% rise from this time last year compared to confidence in New Zealand capital markets only making a 3% jump,” said Ghandar.
“The survey confirms that New Zealand’s strong response to COVID has translated into solid domestic investor confidence.
“Now that New Zealand investors’ preferred international markets are gaining control over the COVID crisis and vaccine rollout, it appears some of that domestic confidence is spilling over into foreign investment optimism.”
Investor confidence in New Zealand’s auditors and public financial information remains solid with independent auditors remaining as the most trusted group to advance investor protection, followed by independent audit committees and analysts.
“Auditors and public financial information are the silent cogs keeping New Zealand’s economic wheels turning,” said Ghandar.
“New Zealanders continue to have high regard for audit, with 92% of respondents having confidence in the audited reports of listed companies and 58% reporting particularly high levels of confidence.
“Confident investors see auditing as well regulated in New Zealand, and they have faith in the ethics and honesty of auditors as well as being alive to the reputational risks and impacts where companies get reporting wrong.
“Strong audit is vital for both domestic and foreign investor confidence. In saying this, New Zealand faces a critical auditor shortage, so it is important that the audit profession continues to work closely with the capital markets and the Government to ensure this confidence is maintained.”
The full 2021 Investor Confidence Survey Report will be released later this month.