Investors are pricing in recession risk, even if forecasters aren’t sure

Higher inflation and mortgage rates are likely to mean less retail spending in the coming year. (Image: Getty)

Fri, 15 Jul 2022

New Zealand’s benchmark equity index has dropped roughly 15% year-to-date, largely due to higher interest rates, but some sectors appear to have fallen further.Retail stocks, for example, have almost all fallen more than 20% and may reflect investors' pricing in a possible hit to earnings that would come with a recession. Kathmandu’s parent company, KMD Brands, told the market on Wednesday to expect total sales to be roughly $960 million, up about $40m from last year. But the stock is still down more than 25% since the...

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