This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

Significant Market Volatility Prompts Decline In Global Pension Funding Levels In Second Quarter Of 2010

After three consecutive quarters of improvement, a new analysis from Hewitt Associates, a global human resources consulting and outsourcing company, found that significant decreases in global equity markets and interest rates led to a decline in the overall financial status of pension plans in the second quarter of 2010. This market volatility contributed to the lowest global pension funding levels Hewitt has seen since the onset of the financial crisis and recession. It also erased nearly all of the improvement in funded status that pension plans experienced over the last 18 months.

Hewitt monitors and analyzes daily pension funding levels of U.S., U.K., Continental European, and Canadian companies in the S&P 500, FTSE 350, DJ Euro Stoxx 50, and TSX, respectively, through its Pension Risk Tracker tool. Hewitt found that the overall funded status of pension plans in these regions was 80 percent at the end of the second quarter of 2010, 7 percent lower than the funded status levels at the end of the first quarter (87 percent). This translates to about $500 billion global pension deficit. According to Hewitt’s estimate, global pension assets fell by $91 billion in the quarter, while pension liabilities increased by $106 billion over the same period.

“After solid performance in April, global equity markets fell meaningfully in May and June, which drove down pension asset levels. This, coupled with higher liability valuation due to falling interest rates, further worsened the health of defined benefit plans globally,” said Ari Jacobs, Hewitt’s North American Retirement Solutions leader. “As market volatility around the world continues, companies need to carefully monitor both the asset and liability side of the equation and understand how they intersect. This approach will enable companies to respond more quickly to swings in the market and help them make decisions that optimize risk and return.”

1 of 4

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
DOW 17,079.57 -42.44 -0.25%
S&P 500 1,996.74 -3.38 -0.17%
NASDAQ 4,557.6950 -11.9260 -0.26%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs