ESG investing more important than ever

Many investors are interested in the impact of their investments on the world around them, as well as in the financial performance of the companies in which they invest. Next year, the investment industry in the European Union (EU) will be under a regulatory requirement to take Environmental, Social and Governance (ESG) matters into account … Continue reading “ESG investing more important than ever”

The virus remains difficult to control

Even in the most freedom-loving societies there was widespread buy into controls for the initial lockdowns. Now consent is waning. It’s been another week dominated by pandemic news. Donald Trump’s contentious approach to tackling the disease has been centre stage, with his self-announced triumph over the illness thanks to a couple of drugs that he … Continue reading “The virus remains difficult to control”

Covid-19 and the Japanese model

The Japanese economy was in recession when the virus struck. GDP fell 1.8% in the fourth quarter of 2019 and experienced a further small fall in quarter 1 2020. Japan’s decline of 7.9% in the second quarter was a large fall by historic standards but was at the lower end of declines worldwide as economies … Continue reading “Covid-19 and the Japanese model”

What will the US elections do to markets?

The question whether Democrats or Republicans will have a majority in the House of Representatives and Senate matters to markets. According to the polls, the Presidential election is Joe Biden’s to lose. He has been comfortably ahead by around 8% in the national polls for some time. He is also ahead in most of the … Continue reading “What will the US elections do to markets?”

China plans to pull further ahead of the US in 5G

The fractious relationship between the US and China is changing global supply chains. China now plans to leapfrog the US in an essential component of the future economy, increasing divisions further. When Beijing decided that China needed to become an atomic power in the 1960s, its centrally-planned state directed significant resources and resolve into developing … Continue reading “China plans to pull further ahead of the US in 5G”

Do shares always win in the long run?

It used to be a common belief of many managers that if you bought and held a portfolio of shares over any market cycle you would earn a decent return. This argument may be changing. The argument went that the sharp cycles in shares were based on shallower and shorter cycles for economies. They might … Continue reading “Do shares always win in the long run?”

Riding the central bank stimulus

The major issues today are how fast the recovery will be, how widespread will it be, and how much permanent damage will remain. Bulls in the stock market are excited by the recovery cycle. It now looks as if all the major economies have passed the worst of their troughs in output and incomes brought … Continue reading “Riding the central bank stimulus”

The US Presidential election remains an uncertainty for markets

The US presidential elections take place on November 3 and Donald Trump is now closing the gap in the polls with Joe Biden. The result remains too close to call. The US election is now Democrat candidate Joe Biden’s to lose. Donald Trump’s grand strategy has been badly damaged by the virus. His plan was … Continue reading “The US Presidential election remains an uncertainty for markets”

The performance of world markets in the pandemic

Equity-market performance around the world has diverged in response to government stimulus measures and those exposed to the digital revolution. At the end of July, the S&P 500 index of larger US company shares pushed ahead of its starting level this year. Nasdaq powered on, forming more new highs. It has now delivered a 22% … Continue reading “The performance of world markets in the pandemic”

The investment trends accelerated by Covid-19

The Covid-19 outbreak is likely to change the way we think, work and live. It is accelerating trends that were already in place and changing people’s behaviour. All of this has implications for investors. Here we look at some of the long-term consequence of the ongoing pandemic. Creating jobs by de-carbonising the economy Creating jobs … Continue reading “The investment trends accelerated by Covid-19”

Government borrowing is large but not yet a problem

Advanced country governments have found it easy to increase their borrowings at very low interest rates, but they can’t make a habit of borrowing such large sums. Over the last three months, most governments have greatly increased their spending and suffered a major decline in tax revenues. There was always going to be a large … Continue reading “Government borrowing is large but not yet a problem”

Central banks continue to prop-up markets

The tsunami of money has been unprecedented and is the main reason equity markets have performed as they have. The stimulus measures have been at their largest in the US, where money growth has shot up to 25% for the year. In the Eurozone and the UK, it is a lively but more modest 10%. … Continue reading “Central banks continue to prop-up markets”

The beneficiaries of globalisation are right to be worried

The dispute between China and the US is likely to continue for many years as their clash of ideologies changes global trading patterns and supply chains. A senior American politician publicly derided one of the most important British companies on a scale we have not seen since attacks on BP following its oil spill in … Continue reading “The beneficiaries of globalisation are right to be worried”

Battling the pandemic speeds up business changes

Before the pandemic struck, high streets were already under pressure, the digital revolution was gathering pace and green change dominated the agendas of European governments. Global trade was under attack and a new Cold War was brewing between China and the US. On the high streets many shops and retail chains were struggling. High rents, … Continue reading “Battling the pandemic speeds up business changes”

Washington wants to halt US investment in Chinese companies

The controversy over the initial stages of the Covid-19 infection in China has allowed a raft of measures to be put on the table to ensure the superpower advantage remains with the US.  Washington wants to starve Chinese companies of money, with investors required to consider “America first”. In a speech given in the White … Continue reading “Washington wants to halt US investment in Chinese companies”