News Round Up

Emerging economies answer to global slowdown, S&P withdraws LM rating.

Tuesday, March 25th 2008, 7:02AM

The world should look to emerging economies and not the United States to help it through the current global economic slowdown, Arcus Investment Management.

"The growth of emerging economic giants China and India, and other emerging economies such as Russia and Brazil, are providing a major cushioning effect that is likely to be the difference between a global slowdown and a recession," said Arcus chief economist Rozanna Wozniak.

"We are in a very different market environment from the last global downturn of 2001, when equity markets in many parts of the world were overvalued. This time, many markets are reasonably priced and, in some cases, are cheap on an historical basis," Wozniak said.

However she says that that New Zealand hasn't yet reached a point where it offers compelling value.

S&P withdraws LM rating

Standard & Poor's has withdrawn the two-star rating on LM Investment Management's LM First Mortgage Income Fund (12 Months) at the request of the manager. The fund was downgraded by S&P from three stars to two stars in June 2006.

"S&P has been requested by LM Investment Management to withdraw the current rating," said S&P fund analyst, Peter Ward. "The manager has informed S&P that that there have been no material changes to the product that may have had a material impact on the fund, its ability to meet investment objectives, or its ability to meet its obligations to investors."

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