Market & Portfolio Update - May 2025
The global share market (represented by the MSCI World Gross Index) was up +5.3% in NZ dollar terms during May, as consumer sentiment improved and trade tensions eased. Progress in US trade negotiations with the European Union and a temporary delay to planned tariff hikes reduced fears of a global recession and fuelled broad-based gains. While the information technology sector was one of the best performing US sectors, the rally also extended to cyclical sectors such as industrials and consumer discretionary.
The Reserve Bank of New Zealand (RBNZ) cut the Official Cash Rate by 0.25% to 3.25% during May, as largely expected by the market. The RBNZ noted they remain confident the inflation outlook is benign and are well placed to respond to developments as they unfold. Similarly, the Reserve Bank of Australia cut their cash rate in May by 0.25% to 3.85%, as anticipated.
The NZ government released Budget 2025, which contained few surprises from a macroeconomic perspective. The flagship policy for the Budget was a new rule allowing businesses to write off 20% of the value of new assets – such as machinery, tools and equipment – from their tax bill in addition to regular depreciation.
Disclaimer: This article has been prepared for the purpose of providing general information, without taking into consideration any particular person's objectives, financial situation or needs. Any opinions contained in it are held by the author as at the report date and are subject to change without notice.
The magic of the managed fund
Let’s talk about shares for a minute. No matter how you invest, there are really just two ways to make money from owning shares:
1. You receive a slice of the profits (called dividends), or
2. You sell your shares to someone else for more than you paid (that’s capital gain).
That’s it. Anything else is simply a different way of packaging those two outcomes.
What is Life Insurance?
Life insurance is one of those things that many people know they should probably have but they’re not quite sure what it does, how it works, or whether it’s actually relevant to them. This article breaks it down in clear, everyday terms to help you understand the basics before you decide if it’s something worth exploring further.