Message from Coach
On this week’s market summary:
📍1. The desolate streets around Madrid’s 17th-century Plaza Mayor help explain why Spain’s banks have embarked on a hasty round of consolidation that could put up to three-quarters of the country’s loans and deposits in the hands of just three lenders. José Fernando Bartolomé, whose family operates tourist outlets in the neighbourhood, says his company, EU Souvenirs, can no longer service its outstanding loans. Because of the coronavirus crisis, the group’s revenues have fallen by more than 90 per cent and its debts have tripled to €4.5m. In these circumstances the question becomes if — rather than when — such debtors can ever repay their obligations.
📍2. The heads of Europe’s biggest industrial companies have declared the bloc is on its way to recovery, showing a sharp rebound in confidence in prospects for their businesses and the economy over the next six months. While cautioning that recovery was still fragile as a second wave of the pandemic sweeps the region, Europe’s leading industrialists said they had seen a large improvement in business conditions — even before news of successful vaccine trials broke last week, according to a twice yearly survey of members of the European Round Table for Industry. The poll, which surveyed the chairs and chief executives of 55 companies with combined revenues of €2tn, found that a measure of their confidence had jumped from 34 out of 100 in May to 61 at the end of October. A score above 50 reflects more positive than negative responses.
📍3. When David, an executive at a top global investment fund, swapped Hong Kong for Singapore this year, he was delighted to find he could rent a six-bedroom house with a verdant backyard for two-thirds of the price of the three-bedroom apartment he was used to. “The family loves the extra space,” says David, who did not want to give his real name. “Now we are looking at buying.” Buyers from Hong Kong, and other expats, have been moving to Singapore since the end of the city-state’s lockdown in June. This has helped bolster its property market despite a record-breaking economic downturn.
📍4. The abrupt decision by Vanguard to cut ties with many large institutional investors in Asia has left at least one feeder fund business partner in the region apprehensive about its future commercial relationship with the US fund giant. An executive from an Asia-Pacific asset manager that runs funds that feed into Vanguard’s investment strategies contacted Ignites Asia this month to express frustration about not being able to obtain greater clarity from the US asset manager about its recent moves in the region. In August, Vanguard shut its office in Hong Kong and ended its exchange traded fund business in the market, while also retreating from the Japanese market.
One of the must-ask interview questions for banking and finance is: “Have you read any news recently?”, with the follow-up questions: “How would you link this news to the market and what investment suggestions would you give to your clients based on this news?”
Showing your market sense and ability to provide feasible investment ideas would help to differentiate you from other candidates. Therefore, apart from the weekly news update / investment insights, we have also generated this Weekly Market Summary for you to have a quick understanding of the market development and tips to answer some hot discussion topics.
Take a look of the summary and WhatsApp us in the group if you have questions.