By Peter V O'Brien
Friday 11th October 2002 |
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"Reasonably performing" is used in the context of comparing our market's relationship with international stock exchange indices since the end of 2001.
It could also be said the New Zealand technology stocks' outrun this year was well ahead of their overseas counterparts, particularly in the US.
The latter suffered from a combination of disillusionment with puffed-up technology companies and well-publicised corporate scandals, several related to technology groups.
Share-price movements from the end of last year to Monday this week are in the table.
A couple of technology companies disappeared since NBR surveys of the sector in December 2001 and June this year.
Declining share prices were the constant in both periods and in the 3.5 months from mid-June to Monday.
It could be a market miracle, corporate tenacity, or both, that some of the 23 companies in the table are still on the Stock Exchange list.
The definition of "technology," as related to companies in the table, is broad, including groups from heavyweight Telecom through computer hardware and software operations to those at the edge of applied science, such as Blis Technology and Genesis Research, the last with developments divided between health science and plant science.
Companies operating retail services through the internet should be, or soon will be, aware there is worldwide dissatisfaction with their activities.
Goods can be delayed, not in accordance with specifications (an offence under most countries' consumer protection legislation, including New Zealand's) or a ripoff, the last involving access to credit information.
Legitimate operators in internet commerce suffer from the devious activities of the fraudsters, leading the cynicism among the public and downgraded investment in listed companies.
There is a view, valid or otherwise, that buying goods through the internet, or on advertised 0800 telephone numbers, is a short-term fad.
The 0800 number system obviously works, at least currently, or traders would not pay the advertising costs.
It may not last. We were told in the 1970s the then standard use of cash would give way to plastic money, whether through the now-titled eftpos, credit cards and other high-tech systems.
That happened in part. It is worth noting how many eftpos transactions involve cash acquisitions either above the cost of the goods bought or as standalones.
Futurist gurus told us personal shopping would die. Orders would be entered into computers linked to the stores, with payment through plastic and delivery to those at home. I claim a wee justification here. That concept was rubbished in a similar column in NBR at the time.
It was said shopping was a social activity. So it proved. Throngs of families, lovers, friends and the lonely took to seven-day, sometimes 24-hour, shopping.
New Zealand came lately to the system, but enthusiastically adopted it.
Competent, long-established retailers here were not fools. They realised the value in opening on weekends, a period when they apparently get their best daily turnovers for the week.
Technology buffs were wrong in that area, a point investors were quick to note.
Investors also reacted quickly to the failed claims of technology companies in other areas.
That does not mean scientific-technology companies should be ignored because of a general reaction against groups associated with them.
Even the currently written down IBM grew out of a modest 1920s typewriter company that foresaw the future. It was growth and technology led to Microsoft's Bill Gates eclipsing for now, at least the former top dog.
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