|
Fund Name Changed
|
|
Friday, 15 November 2024
|
Official Announcement
|
Sarasin IE Multi Asset Income Fund (GBP) changed to Sarasin IE Multi Asset Defensive Fund (GBP).
|
| |
|
Fund Name Changed
|
|
Friday, 28 June 2024
|
Official Announcement
|
Sarasin Responsible Equity Fund (GBP) changed to Sarasin Responsible Global Equity Fund (GBP).
|
| |
|
Fund Name Changed
|
|
Tuesday, 7 March 2023
|
Official Announcement
|
Sarasin Responsible Equity Fund changed to Sarasin Responsible Equity Fund (GBP).
|
| |
|
Fund Name Changed
|
|
Monday, 28 February 2022
|
Official Announcement
|
Sarasin IE Multi Asset - Defensive (GBP) changed to Sarasin IE Multi Asset Income Fund (GBP).
|
| |
|
Management Company name changed
|
|
Thursday, 24 February 2022
|
Official Announcement
|
Management Company name changed from Sarasin Funds Management (Ireland) Ltd. to Waystone Management Company (Ireland) Ltd.
|
| |
|
Fund Name Changed
|
|
Tuesday, 6 July 2021
|
Official Announcement
|
Sarasin IE GlobalSar - Dynamic (GBP) changed to Sarasin IE Multi Asset - Dynamic (GBP.
|
| |
|
Fund Name Changed
|
|
Tuesday, 25 February 2020
|
Official Announcement
|
Sarasin IE Sustainable Global Real Estate Equity changed to Sarasin IE Sustainable Global Real Estate Equity (USD).
|
| |
|
Fund Name Changed
|
|
Thursday, 21 February 2019
|
Official Announcement
|
Sarasin IE Sustainable Global Real Estate Equity (USD) changed to Sarasin IE Sustainable Global Real Estate Equity.
|
| |
|
Fund Name Changed
|
|
Tuesday, 22 November 2016
|
Official Announcement
|
Sarasin IE EquiSar - Global Thematic (GBP) changed to Sarasin IE Global Equity Opportunities (GBP).
|
| |
|
Management Company name changed
|
|
Thursday, 26 July 2012
|
Official Announcement
|
Management Company name changed from Sarasin & Partners LLP to Sarasin Fund Management (Ireland) Ltd.
|
| |
|
Fund Name Changed
|
|
Thursday, 17 November 2011
|
Official Announcement
|
Sarasin IE EquiSar - Global Thematic Fund (USD) changed to Sarasin IE EquiSar - Global Thematic (USD)
|
| |
|
Redomicile
|
|
Thursday, 30 June 2011
|
Official Announcement
|
Sarasin has redomiciled their Guernsey funds to Dublin effective 01 July 2011
|
| |
|
Sarasin's week at a glance - 18 Jan 2008
|
|
Monday, 21 January 2008
|
Fund Manager Comment
|
In the UK, the Consumer Prices Index measure of inflation remained unchanged at 2.1% for the third consecutive month, while the Retail Prices Index measure fell from 4.3% to 4%. The main pressure on inflation was attributed to the rise in food prices. Data indicated that UK retail sales were down 0.4% in December and a surveyors' report suggested that house prices were suffering their worst declines since the 1990s. Following this data, expectations rose further that the Bank of England will cut interest rates at its next meeting.
US consumer prices inflation reached its highest level in 17 years in 2007, with prices rising 4.1% for the full year. Despite inflation remaining a concern, the Federal Reserve is widely expected to cut interest rates by 50 basis points at their next meeting on 30th January, with the possibility of a 75 point cut. The Fed chairman, Ben Bernanke, has also backed emergency fiscal intervention aimed at helping the US economy to avoid recession. President Bush is expected to announce these measures on Friday afternoon.
Global equity markets continued their poor start to 2008 with all major indices experiencing declines. Fears of a US recession and the announcement of worse than forecast losses by Citigroup and Merrill Lynch pushed markets lower. However, Asian and European indices stabilised on Friday on the news that the US government is preparing a major fiscal stimulus proposal.
Sterling was weaker against the US dollar and the euro after weak UK retail sales data increased the likelihood of a cut in interest rates. The US dollar was also stronger versus the yen and the euro, boosted by the US government's fiscal package and indications that the European Central Bank may become less hawkish on eurozone interest rates.
|
| |
|
Sarasin's week at a glance - 11 Jan 2008
|
|
Monday, 14 January 2008
|
General Market Analysis
|
The Bank of England voted to keep UK interest rates on hold at 5.5%. The decision was expected to be close as policymakers weighed up signs of a consumer slowdown against growing inflationary pressures. It is now widely expected that the MPC will cut interest rates in February after the release of its quarterly inflation report and new growth and inflation forecasts. However, a report from Halifax showed that UK house price inflation fell sharply at the end of 2007.
The European Central Bank also decided to leave its interest rates unchanged at 4%. Eurozone inflation has remained above the ECB's target rate of 2%, buoyed by higher oil and food prices.
In the US, Chairman of the Federal Reserve Ben Bernanke warned that the outlook for the US economy in 2008 has deteriorated. However, he reassured investors that the Fed was prepared to act in a decisive and timely manner to ensure that economy remained stable. This speech increased expectations that the Fed would cut interest rates again later this month, perhaps by 50 basis points.
Global equity markets ended the week slightly lower. Stocks fell in the US midweek after two leading investment banks warned that the US economy was heading for a recession. However, markets recovered towards the end of the week, boosted by Bernanke's speech and the prospect of further interest rate cuts.
In currencies, sterling fell to a record low against the euro as UK manufacturing output declined. The pound also fell against the US dollar.
The price of gold rose to an all-time high of $881.28 an ounce while the oil price remained just below last week's peak of $100 a barrel.
|
| |
|
Sarasin's week at a glance - 21 Dec 2007
|
|
Monday, 7 January 2008
|
General Market Analysis
|
The minutes from their meeting earlier this month showed that the Bank of England voted unanimously in favour of cutting UK interest rates to 5.5%. Data showed that the Consumer Prices Index measure of inflation remained at 2.1% in November, while the Retail Prices Index rose to 4.3%. UK retail sales were also steady over the three months to the end of November, up 1.1%. This evidence of stable inflation and retail sales, may give the BoE confidence to cut interest rates again in the New Year.
US consumer spending, which was boosted by longer opening hours and discounts, was also strong in November rising 1.1%. There were signs of inflation, however, as CPI rose by 0.6% last month.
The Bank of Japan decided to keep its interest rates at 0.5% citing concerns over the state of the global credit markets and domestic business confidence. The central bank also lowered its economic growth prediction for the year to March 2008 and they are expected to keep rates on hold until the middle of next year.
Global equity markets rose steadily towards the end of the week. In the US, technology shares led the gains on Thursday to help boost markets despite financial stocks continuing to drag. In the middle of the week, Asian banks were strong after China's government controlled investment vehicle bought a stake in Morgan Stanley.
In currencies, the pound fell to a record low against the euro following growing expectations of further UK interest rate cuts. Sterling also fell below the $2 mark.
|
| |
|
Sarasin's week at a glance - 4 Jan 2008
|
|
Monday, 7 January 2008
|
General Market Analysis
|
The December construction PMI unexpectedly increased from 54.3 to 56, which marked an increase in growth in business sub-sectors. The Index revealed a decrease in housing construction, however. Meanwhile, the Bank of England (B0E) released its Credit Conditions survey, which indicated a further tightening in bank lending for companies and households. Demand for secured lending rose in the 4th quarter of 2007 but will likely decline this month. The BoE estimates that lenders will likely continue to reduce the availability of secured credit and mortgage defaults are likely to rise through March of 2008. Further tightening in the credit markets may bolster the case for rate cuts in the first quarter of 2008, as long as inflation concerns do not increase.
The US ISM manufacturing number fell below 50 to 47.7, its lowest level since April 2003. Data released this month also indicated that US new home sales in November dropped 9.0%, the lowest level since 1995 and a new low for this housing cycle. Despite these indicators, economic conditions in the US remain generally remain mixed. Retail sales, while cooling, remain resilient and non-farm payroll numbers are in positive territory despite a steep decline in December.
Global equity markets started off the year with a volatile performance, dragging particularly in response to the weak US payroll data. India, China and Malaysia have been strong whereas Taiwan has fallen off since late 2007. Japan's Nikkei started off the New Year two trading days after the rest of the world (due to extended holidays) with a 4% loss, -- its slowest annual start in history. Its lacklustre start was on the heels of US economic fears, the falling dollar against the Yen and soaring commodity prices (oil surpassed $100 for the first time).
In currencies, Sterling continued to fall to a record low against the Euro, reaching 1.3364 and also fell below the $2 mark against the US Dollar. In the first week of January, Sterling was the only major currency that did not appreciate against the falling dollar.
|
| |
|
Sarasin's week at a glance - 14 Dec 2007
|
|
Thursday, 20 December 2007
|
General Market Analysis
|
In the UK, the RICS survey revealed that UK house prices fell for the fourth consecutive month in November. It also showed evidence that price declines were becoming more widespread.
In the US, the Federal Reserve cut interest rates by 25 basis points to 4.25% as it attempts to soften the effect of the housing and credit crises on the economy. The Fed also decided to cut the discount rate, which is the rate at which it lends to banks, from 5% to 4.75% to help reduce the problems in the credit markets. However, inflation fears remain as US factory prices rose 3.2% in November, their highest rate for 34 years. Consumer confidence remains robust as retail sales rose by twice as much as expected last month, up 1.2%.
Global equity markets experienced another volatile week with large declines in most regions. The US markets sold off sharply after the announcement of the cut in interest rates as many people had hoped for a greater reduction. The weak sentiment spread to Europe and Asia as investors' concerns grew over whether combined action by central banks would be able to ease the credit crisis.
In currencies, the US interest rate cut boosted the US Dollar against both the Pound and Euro.
|
| |
|
Sarasin's week at a glance - 7 Dec 2007
|
|
Friday, 14 December 2007
|
General Market Analysis
|
The Bank of England decided to cut UK interest rates by 0.25% to 5.5%. The move was widely expected following indications that the UK economy is slowing. However, with rising food and oil prices, there remain concerns about inflation. Earlier in the week, reports showed that UK house prices fell 1.1% in November, while consumer confidence experienced its largest monthly decline since 2004. Sterling was weaker as investors anticipated the reduction in interest rates.
The European Central Bank opted to leave eurozone interest rates on hold at 4% following higher inflation figures. The Euro remained at its high levels against the other major currencies.
US productivity jumped to its highest level in four years in the third quarter of this year, while labour costs fell 2%. The growth in productivity was better than expected and should ease worries about inflation. In an attempt to reduce the impact on homeowners, President Bush announced plans to freeze the interest rates on a number of sub-prime mortgages for up to five years.
Global equity markets had a very strong week, boosted by the interest rate decisions in the UK and Europe, and the sub-prime mortgage plan in the US. The news from the US also buoyed Asian stock markets, with the Nikkei in Japan reaching a one-month high. Investor sentiment was also helped by growing expectations of a further cut in US interest rates when the Federal Reserve meets next week.
Oil remained around the $90 a barrel mark after OPEC agreed that they would not increase supply.
|
| |
|
Sarasin's week at a glance - 30 November 2007
|
|
Wednesday, 5 December 2007
|
General Market Analysis
|
According to Nationwide, UK house prices saw their largest fall in twelve years during November. Data suggested that the price of an average home fell by 0.8% from the previous month, while the annual growth rate of house prices has also fallen from 9.7% to 6.9%.
In the US, house prices experienced the largest quarterly drop in 21 years in the third quarter of this year, down 4.5% from the same period a year earlier and 1.7% from the second quarter. As a result of the problems in the US housing market and the global credit markets, the White House has cut its forecast for 2008 economic growth from 3.1% to 2.7%. Further weak data emerged as US consumer confidence fell to its lowest level since the aftermath of Hurricane Katrina two years ago.
The US Federal Reserve is now widely expected to cut interest rates when it meets next month after the Fed chairman, Ben Bernanke, said that the real economy could be harmed by the recent tightening in financial conditions.
Eurozone inflation jumped from 2.6% to 3.0% in November, its highest level in six years. With the ECB expected to keep interest rates on hold, the divergence between interest rates in the eurozone and the US caused the euro to strengthen further against the US dollar.
Global equity markets rose strongly after a poor start to the week. Comments from members of the Federal Reserve helped boost stock markets while reassuring statements from two UK mortgage lenders helped lift UK shares.
|
| |
|
Sarasin's week at a glance - 23 November 2007
|
|
Monday, 26 November 2007
|
General Market Analysis
|
The minutes from the Bank of England's November meeting showed that the members of the Monetary Policy Committee voted 7-2 in favour of keeping UK interest rates on hold at 5.75%. While the two members who voted for a cut in rates were concerned with the ongoing turmoil in financial markets, the majority of the members said they had yet to see any effects of this on UK consumers and firms. There are, however, still inflation risks to the economy caused by higher oil and commodity prices.
In the US, the Federal Reserve lowered its forecast for economic growth in 2008, stating tighter credit markets and weakness in the housing sector. The Fed now estimates growth in the range of 1.8% to 2.5%, down from its previous prediction of 2.5% to 2.75%.
In October, Japanese exports increased by 13.9% from the previous year, reaching a record high. The figures were boosted by sales to Europe and, in particular, China which is set to become Japan's largest export market taking over from the US. Concerns remain, however, about how the Japanese economy will be affected by a slowdown in the US economy.
Global equity markets experienced another volatile week and most major indices ended lower. Markets were hit by more bad news from the banking sector and growing fears over the US economy. The continued nervousness in the financial system and across stock markets has led to a strong rally in government bonds. Some US Treasury yields are currently at their lowest level for three years.
The Fed's announcement of its prediction for 2008 economic growth increased expectations of further interest rate cuts in the US and pushed the US dollar to a record low against the euro. The yen also strengthened against the dollar.
Oil prices almost broke through $100 a barrel on Wednesday boosted by the weak US currency, lower supplies and increasing demand.
|
| |
|
Sarasin's week at a glance - 16 November 2007
|
|
Tuesday, 20 November 2007
|
General Market Analysis
|
In the UK, the Bank of England released its quarterly Inflation Report in which it warned that the UK economy faces a number of risks next year. The Bank lowered its forecast for economic growth in 2008 to 2.2%, signaling that interest rates could fall from their current level next year. There were further calls for lower interest rates after UK retail sales fell for the first time in nine months in October. However, despite the weaker demand for clothing and footwear following the wet summer and higher interest rates, the longer-term trend remains positive.
The US experienced a jump in the Consumer Prices Index measure of inflation in October, rising 0.3% compared with the previous month, driven by higher fuel and food costs. This reflects an annualised rate of 3.5%. This inflation data came the day after US retail sales and producer price figures indicated that demand is weakening in the US.
Higher food and oil prices also helped push eurozone inflation to 2.6% in October, its highest level in two years. The European Central Bank highlighted that it is still prepared to raise interest rates to combat inflation.
Global equity markets rose at the beginning of the week before falling back as more banks announced billion dollar write-downs giving rise to further concerns over the health of the financial sector.
In currencies, the pound fell from its record levels against the US dollar and reached a four year low against the Euro as investors reacted to the BoE's quarterly Inflation Report.
|
| |
|
Sarasin's week at a glance - 9 November 2007
|
|
Monday, 12 November 2007
|
General Market Analysis
|
The Bank of England voted to keep UK interest rates unchanged at 5.75% as widely expected. The decision is likely to have been based on concerns over higher inflationary pressures, influenced by the rising price of oil. Following the news, the pound strengthened further against the US dollar.
The European Central Bank also opted to leave its interest rates on hold at 4.0%. Before the global credit crunch, the ECB had been widely expected to raise European interest rates to 4.5% by the end of the year, however, they are now expected to remain unchanged. In his accompanying statement, President Trichet, explained that there were still "upside risks" to inflation and they would continue to "monitor very closely all developments".
In the US, Chairman of the Federal Reserve, Ben Bernanke, warned that the financial restraint caused by the credit crisis will slow the US economy before the end of the year. Meanwhile, the weakness of the US dollar helped the US trade deficit narrow to its lowest level in over two years. This followed news that exports rose 1.1% to a record level in September.
Global equity markets finished lower after experiencing another turbulent week. US, European and Asian shares saw strong falls prompted by fresh concerns over the global effects of the credit crunch. However, outside of the Financials sector, many stocks were boosted by positive earnings results and fresh M&A activity.
|
| |
|
Sarasin's week at a glance - 2 November 2007
|
|
Monday, 5 November 2007
|
General Market Analysis
|
The US Federal Reserve decided to cut US interest rates from 4.75% to 4.5%. This quarter point cut was widely expected as the Fed attempts to revive the troubled US housing market and protect the US economy from recession.
Earlier in the week, data showed that despite the global credit crunch and US housing downturn, the US economy grew at 3.9% per annum in the third quarter of the year. This was up from 3.8% in the previous quarter. Consumer spending was also higher in the three months to September, although the growth of spending in September was slower than expected.
In another turbulent week for global equities, markets rose following the announcement of the Fed's interest rate cut but subsequently experienced heavy falls on renewed concerns about the impact of the sub-prime crisis on the US economy. The US equity markets led the sharp declines as financial stocks suffered their worst day in five years.
In currencies, the US dollar weakened further against the pound and euro as the Fed cut interest rates, with sterling reaching its highest levels since 1981. There was some respite for the dollar, however, as it benefited from the sell of in global stock markets.
Oil prices continued to rise this week, breaking through the $96 a barrel mark while gold also hit a 27 year high.
|
| |
|
Sarasin's week at a glance - 26 October 2007
|
|
Tuesday, 30 October 2007
|
General Market Analysis
|
Global stock markets rose this week after initially starting the week lower. In the UK, markets were boosted by a survey of British industry which showed that factory orders grew strongly over the last three months, providing an indication that manufacturers have been largely unaffected by weakness in financial markets.
In the US, sales of existing homes fell by 8% in September. This figure was worse-than-expected and represents the biggest year-on-year decline in 16 years. The average sales price also fell 4.2% since a year ago. US equity markets experienced a volatile week as investors reacted to mixed earnings results.
The poor US housing market and weak durable goods data increased uncertainty over the outlook for the US economy and further heightened the prospects that the Federal Reserve will cut interest rates at its meeting on 31st October. Following these concerns, the US dollar fell to another record low against the euro and a three-month low versus the pound.
Oil prices reached another record as an unexpected fall in US stockpiles and fresh tension between the US and Iran pushed the price through $92 a barrel.
|
| |
|
Sarasin's week at a glance - 19 October 2007
|
|
Monday, 22 October 2007
|
General Market Analysis
|
The UK Consumer Prices Index measure of inflation remained unchanged at 1.8% in September, with upward pressure from rising food prices being offset by lower energy bills. The Retail Prices Index measure fell from 4.1% to 3.9%. UK retail sales rose by more than expected in September, up 0.6%. Following this strong retail sales data and the announcement that the Bank of England voted 8-1 in favour of keeping UK interest rates on hold earlier this month, analysts believe an imminent interest rate change is unlikely. UK equity markets were lower while sterling strengthened against the US dollar.
The International Monetary Fund has lowered its prediction for global economic growth in 2008 from 5.2% to 4.8%. It explained that its primary reason for the downgrade was the turbulence caused by the slump in the US housing market.
There was more bad news for the US housing market as the number of new homes being built fell by 10.2% and applications for building permits fell 7.2% in September. Weak US jobs and manufacturing data increased expectations that the Federal Reserve will cut US interest rates at its next meeting. In addition to the poor economic data, some worse than expected earnings announcements pushed stock markets lower. Meanwhile, the US dollar remains close to record lows against the euro and a three-week low against the Japanese yen.
Oil prices broke through $90 a barrel for the first time, following lows in the dollar and rising fears over tensions in eastern Turkey.
|
| |
|
Sarasin's week at a glance - 12 October 2007
|
|
Thursday, 18 October 2007
|
General Market Analysis
|
UK manufacturers enjoyed the strongest demand in almost 20 years during the third quarter. However, many manufacturing firms reported that they were experiencing pressure to increase their prices. This evidence of possible inflation may lower expectations of a UK interest rate cut in the near future. In contrast, a report showing that UK house price growth has halved in the last six months, provided further evidence of a slowdown in the UK housing market and lifted prospects of rate cuts next year. Sterling was lower following this announcement.
In the US, the trade deficit fell by 2.4% in August which was more than expected. Helped by the weak dollar, the value of US exports rose to a record level while imports fell. The minutes from the Federal Reserve's September meeting showed that their inflation expectations were contained, increasing the likelihood of another rate cut before the end of the year.
Global equity markets rose strongly, led by the US, following the release of the Fed's latest minutes. Both the Dow Jones and the S&P 500 set new record highs earlier in the week before falling back as investors took profits. Asian and European markets experienced similar gains.
Oil prices surged past the $83 a barrel level again after a US inventory report showed that reserves were lower than expected
|
| |
|
Sarasin's week at a glance - 05 October 2007
|
|
Wednesday, 10 October 2007
|
General Market Analysis
|
As widely expected, the Bank of England decided to keep UK interest rates unchanged at 5.75%. The Monetary Policy Committee appears to be adopting a wait-and-see approach until there is some clearer data on the effects of the recent global credit crunch. Meanwhile, Chancellor Alistair Darling is expected to reduce the government's growth forecast for the UK economy in 2008 from 3.0% to 2.5%. This forecast is still above the expectations of many analysts who are predicting growth of 2.2% next year.
The European Central Bank also voted to leave interest rates on hold at 4.0%. In his statement, President Jean-Claude Trichet highlighted that there is "heightened uncertainty" about the outlook for Europe's economy and that the ECB would continue to "monitor very closely all developments". The ECB is now expected to keep rates on hold for the remainder of the year. Prior to the announcement, the euro reached another record high against the US dollar.
Key US jobs data came in better than expected on Friday afternoon. The Non-Farm Payrolls, which is a keenly watched measure of job creation, showed an increase in new jobs in September. The previous month's figure, which revealed the first monthly drop in four years, was also revised upwards. The dollar rallied strongly after the announcement as the chances of further US interest rate cuts diminished.
Global equity markets rose this week with the Dow Jones reaching a new record high. The gains were driven by large capitalisation stocks with exposure to international economic growth. Markets shrugged off announcements from several banks as they revealed their exposure to the credit market troubles, choosing instead to focus on the clarity of their reports.
|
| |
|
Sarasin's week at a glance - 28 September 2007
|
|
Monday, 1 October 2007
|
General Market Analysis
|
The OECD warned that the UK may need to cut interest rates to boost the economy as the global credit crunch could push economic growth below 2.5% in 2008. UK house prices rose by 0.7% in September despite the credit markets, although, the annual price growth has slowed to its lowest rate in almost a year at 9%.
There was further bad news for the US housing market as new homes sales fell by 8.3%. The average sales price of a new home also fell 8.3% while orders for durable goods fell by more than expected. These figures increased concerns that the housing market troubles may spread to the rest of the economy and boosted expectations of another interest rate cut by the Federal Reserve. US equity markets were buoyed midweek by the prospect of further cuts and by the decision of General Motors workers to end their strike. Following the weak US macroeconomic data, the Euro climbed to another all-time high against the US currency.
Japanese consumer prices were 0.1% lower in August compared to the same month last year raising concerns that the economy has not escaped deflation and reducing the chance of an interest rate rise this year. However, industrial production was better than expected in August rising 3.4% led by a recovery in car production. The Japanese equity markets experienced strong gains helped by property stocks.
The oil price broke through $83 a barrel as a weak dollar and fears over supply boosted buying. The gold price also hit a 28-year high.
|
| |
|
Sarasin's week at a glance - 21 September 2007
|
|
Tuesday, 25 September 2007
|
General Market Analysis
|
The Federal Reserve voted unanimously to cut the main US interest rate from 5.25% to 4.75%. It also reduced the rate at which banks can borrow from the Fed by 50 basis points to 5.25%. This rate cut is the first for four years and is designed to restore confidence in the US housing market and prevent the recent credit turmoil from damaging the economy. The rate cut caused the US dollar to fall to a record low against the euro, while the Canadian dollar also reached one-to-one parity with the US dollar for the first time in 31 years.
Many people remain concerned about inflationary pressures on the US economy, however, figures showed that the US Consumer Prices Index actually fell slightly in August, due to a sharp drop in energy prices. The Producer Prices Index also fell by 1.4%, the largest drop since last October.
The Bank of England announced that it will inject £10bn into the money markets in an attempt to lower the three-month interest rates at which banks lend to each other. In addition, banks will be allowed to use their mortgage debt as part of their collateral. This marked a U-turn by the BoE who had previously said that it would not interfere in the three-month money market.
Global equity markets soared in midweek after the Federal Reserve's decision. Both the S&P 500 and the Dow Jones enjoyed their biggest daily percentage gain since 2003. Asian and European markets also followed the US higher.
In commodities, the oil price remained close to $82 a barrel and gold neared its highest level in almost 28 years.
|
| |
|
Sarasin's week at a glance - 14 September 2007
|
|
Monday, 17 September 2007
|
General Market Analysis
|
The European Commission revised its expectations for eurozone economic growth in 2007 down to 2.5% from 2.6%. The EC said that the recent financial turmoil had increased uncertainty and it expected the slowdown to continue in 2008.
Investor sentiment remains nervous in the US ahead of the Federal Reserve's meeting next week. Analysts are awaiting the latest US retail sales data for an indication of how the credit problems are affecting consumers and expectations are already mounting that US interest rates could be cut by as much as 50 basis points in an attempt to calm financial markets.
Global equity markets rose this week buoyed by some signs of stability in US money markets. These gains occurred in the face of the price of oil closing above $80 a barrel for the first time. Japanese shares initially fell on Wednesday following the resignation of Prime Minister, Shinzo Abe, but they rose sharply on Friday led by export stocks.
In currencies, the US dollar reached record lows against the euro in anticipation of interest rate cuts next week, while sterling dropped to a 14-month low against the euro.
Wheat prices have broken through the record $9 a bushel barrier for the first time, driven by smaller harvests in drought-hit regions such as Australia while demand has surged from China and India.
|
| |
|
Sarasin's week at a glance - 07 September 2007
|
|
Monday, 10 September 2007
|
General Market Analysis
|
The Bank of England opted to keep UK interest rates on hold at 5.75%. They issued a statement with the decision indicating that they had considered the effects that the current problems in financial markets would have on inflation. UK interest rates were widely tipped to rise to 6% earlier in the year but this is now considered unlikely.
The European Central Bank also decided to keep eurozone interest rates on hold at 4%. This was widely expected as they seek to prevent the problems in credit markets turning into a larger financial crisis. ECB president, Jean-Claude Trichet, highlighted that the eurozone economy remains strong but caution was needed going-forward. The ECB also injected a further €42bn into the banking system to boost liquidity.
The International Monetary Fund announced that it would be revising down its predictions for global economic growth following the turbulence in world markets. The US will see the largest impact despite positive manufacturing data this week. The IMF added that emerging economies remained "relatively robust".
Global equity markets were mostly unchanged this week. US markets rallied on Tuesday led by technology stocks but gave up the gains on Wednesday after poor pending home sales data. Markets were quieter in the run up to the release of important US employment data on Friday afternoon.
|
| |
|
Sarasin's week at a glance - 31 August 2007
|
|
Monday, 3 September 2007
|
General Market Analysis
|
The annual growth rate of the US economy in the second quarter was revised upwards to 4%, which was more than analysts expected. The revised figure was driven by strong business investment and better-than-expected export figures. This positive data was largely ignored by the stock markets which were more concerned with future uncertainty.
Data revealed that the sales of existing US homes fell to its lowest level since November 2002 in the year to July, raising concerns that US house prices could fall sharply.
Global equity markets fell on Tuesday after analysts cut their profit estimates for some major investment banks and the minutes from the Federal Reserve's last meeting revealed their ongoing concern over the US housing market. However, stock markets bounced straight back on Wednesday following reassuring comments from the Fed Chairman, Ben Bernanke. Asian shares were boosted by news that President Bush will announce plans to help US homeowners with sub-prime mortgages in a speech on Friday.
|
| |
|
Sarasin's week at a glance - 24 August 2007
|
|
Friday, 24 August 2007
|
General Market Analysis
|
The Bank of Japan voted to keep its interest rate on hold at 0.5% this week. This decision was widely expected given the recent turmoil in global financial markets and it is the sixth month in a row that the rate has remained unchanged.
Global equity markets experienced a more stable week as the major indices enjoyed consecutive gains. The FTSE 100 rallied for five sessions taking it back into positive territory for the year. Asian markets fell slightly on Friday, while European indices were flat ahead of the US new homes sales data. This data came in better than expected boosting US equities on Friday afternoon.
Earlier in the week, a group of US and European banks borrowed $2bn from the Federal Reserve to improve access to available credit. While this borrowing is usually seen as a last resort, the banks stressed that this was not the case and that they were trying to ease the credit concerns.
In currencies, the euro was higher against most currencies following robust eurozone business activity in August.
|
| |
|
Sarasin's week at a glance - 10 August 2007
|
|
Friday, 10 August 2007
|
General Market Analysis
|
A report by the Bank of England released this week, hinted that UK interest rates may need to rise once more in order to push inflation down to the 2% target. Another rate rise is widely expected before the end of the year. In a press conference, the governor of the BoE insisted the credit problems in the US did not amount to an international crisis.
Global equity markets enjoyed three consecutive days of strong gains at the beginning of the week but then tumbled amid fears that the problems in the US mortgage market may spark a global credit crunch. A cut in US interest rates is now expected within the next two months in reaction to the turmoil in financial markets. Shares across Asia fell and government bonds rose as the worries about subprime loans spread to the region.
The European Central Bank moved to calm fears about a credit crunch by pumping €95bn into the eurozone banking market to increase liquidity. This represents the ECB's largest intervention in the banking sector since the 9/11 attacks in 2001. Other central banks followed suit, including the Federal Reserve and the Bank of Japan, which injected one trillion yen into the financial system.
|
| |
|
Sarasin's week at a glance - 03 August 2007
|
|
Friday, 3 August 2007
|
General Market Analysis
|
The Bank of England voted to keep UK interest rates at 5.75%. The Monetary Policy Committee was widely expected to leave rates unchanged this month as it waits to see the impact of previous increases. The members of the MPC remain concerned about inflation and many economists predict that rates will rise to 6% before the end of the year.
The European Central Bank also decided to leave eurozone interest rates on hold at 4%. ECB President Jean-Claude Trichet stressed that "strong vigilance" was needed on inflation and other economic data, reinforcing expectations that rates will rise again either in September or October.
Global equity markets remained extremely volatile following last week's sharp sell-off. Trading continued to be unpredictable amid concerns over the impact of the US housing slump on credit markets and rising oil prices. There were some markets that saw large intra-day rebounds, including the Dow Jones which rallied strongly on Wednesday. In China, the Shanghai Composite Index closed at records highs three times, helped by hopes for strong corporate earnings.
Oil prices hit a record high of $78.77 a barrel amid worries about whether supplies can meet global demand. The recent volatile stock markets have not affected oil markets which have been boosted by positive economic signs about US employment and consumer confidence
|
| |
|
Sarasin's week at a glance - 13 July 2007
|
|
Monday, 16 July 2007
|
General Market Analysis
|
The Bank of Japan voted eight to one to keep interest rates on hold at 0.5%, reflecting caution over future economic prospects. Japan ’s economy has recovered over the past year but the BoJ stressed that expectations of both current and future economic growth were moderate.
Global equity markets surged into record territory on Thursday led by the major American indices. The Dow Jones and the S&P500 closed at all-time highs, lifted by strong consumer sales and further takeover activity. The Australian, South Korean, Hong Kong and Singapore stock markets also hit life-time peaks on Friday.
Equity markets shrugged off further rises in global oil prices which hit $77 a barrel for the first time in 11 months. OPEC maintained that the higher prices are being caused by insufficient global refining capacity and continuing violence in Nigeria , rather than a lack of supply on their part.
The US dollar continued its fall against other leading currencies amid ongoing concerns over the US sub-prime mortgage sector. The yen weakened further following the announcement from the BoJ and hit a new record low against the Euro.
|
| |
|
Sarasin's week at a glance - 09 July 2007
|
|
Monday, 9 July 2007
|
General Market Analysis
|
The Bank of England voted to raise UK interest rates to 5.75% as the Monetary Policy Committee warned that inflation remains a danger. It is the fifth rise since last August and many expect a further increase before the end of the year. The pound is back above $2 and near a 26-year high against the dollar. Sterling is widely expected to remain at these levels while interest rates are set to go higher.
The European Central Bank decided to keep its interest rates on hold at 4%. The statement accompanying the announcement said that the Bank would continue to “closely monitor” inflation. This indicated that interest rates may rise again later in the year but not at next month’s meeting. The prospect of higher rates strengthened the euro to highs against the US dollar and the yen.
US equity markets rose as fresh M&A activity and strong economic data helped boost confidence. Encouraging manufacturing and non-manufacturing data for June provided another sign that the US economy has improved in the second quarter. Trading volumes were lower as investors awaited key employment data on Friday afternoon.
The Chinese markets have fallen 12% in the last two weeks while trading volumes have also dropped. These moves provide an indication that the Chinese authorities have managed to cool the stock market without triggering a sharp correction.
|
| |
|
Sarasin's week at a glance - 29 June 2007
|
|
Friday, 29 June 2007
|
General Market Analysis
|
UK house price inflation bounced back in June as prices rose by 1.1%. This news added to expectations that UK interest rates would rise as far as 6% by the end of the year. This view was re-enforced by the deputy governor of the Bank of England who said that UK interest rates were too low and were helping to increase demand for credit and loans.
The US Federal Reserve is widely expected to keep US interest rates on hold at 5.25% following it’s meeting this week. Recently, inflation concerns have given rise to fears that rates could be increased before the end of the year. The comments that accompany the Fed’s decision will be eagerly awaited as they may help predict the next move.
The final revision to the first quarter GDP growth in the US showed that the economy grew faster than expected. Consumer spending was the main driver, rising 4.2%, while the housing market continued to weigh on growth.
Global equity markets were flat in the build up to the Federal Reserve’s announcement. The US markets had a strong day on Wednesday driven by technology and energy stocks.
In currencies, the yen enjoyed a three day winning streak against the US dollar while the pound was also strong versus the dollar following the house price inflation data.
|
| |
|
Sarasin's week at a glance - 22 June 2007
|
|
Monday, 25 June 2007
|
General Market Analysis
|
The minutes from this month’s MPC meeting revealed that the Bank of England voted 5-4 in favour of keeping interest rates on hold at 5.5%. The vote was tighter than expected and, for only the second time ever, the governor was on the losing side. The BoE is widely expected to raise interest rates again when it meets next month.
A Conference Board survey predicted that US economic growth would quicken in the coming months as job market strength offsets continuing weakness in the housing market. The Federal Reserve also sees faster growth as the economy benefits from positive consumer sentiment and rising stock markets.
US equity markets fell midweek as higher bond yields caused interest rate sensitive sectors, such as utilities and REITs, to fall while lower oil prices hurt energy stocks.
Asian equity markets rose this week lead by the Nikkei Index in Japan, which hit a seven-year high, and the Hang Seng Index in Hong Kong which gained after Chinese regulators issued new rules allowing fund managers to invest abroad.
The yen fell to its lowest level against the US dollar in four and a half years, helped by expectations that Japanese interest rates will rise only moderately.
|
| |
|
Sarasin's week at a glance - 15 June 2007
|
|
Monday, 18 June 2007
|
General Market Analysis
|
UK Consumer Price inflation fell to 2.5% in May, down from 2.8% in April. The Retail Prices Index also fell to 4.3% from 4.5%. Despite this improved inflation picture, the Bank of England warned that further interest rate rises would be needed to get inflation down to its target of 2%. UK retail sales rose more than expected in May, indicating that higher interest rates are yet to slow consumer demand.
In the US, there was further concern over inflation and possible interest rate rises as data showed that producer prices rose by 0.9% in May, driven mainly by a 10.2% rise in petrol prices, and US retail sales grew by more than expected at 1.4%. The threat of inflation and higher interest rates triggered a sell-off in bond markets which pushed US government bond yields to their highest level in five years.
Global equity markets fell significantly on Tuesday as the sell-off in bond markets spread to equities. However, strong economic data and higher oil prices helped shares rebound to post positive returns for the week.
Japanese stocks gained as the Bank of Japan kept its interest rate on hold at 0.5%. There was further good news as the economy grew by more than forecast in the first three months of the year.
With higher US Treasury yields and the chance of US interest rate cuts this year largely eliminated, the dollar rose to a four-and-a-half year high against the yen and its highest level in two months against the euro and the pound.
|
| |
|
Sarasin's week at a glance - 08 June 2007
|
|
Tuesday, 12 June 2007
|
General Market Analysis
|
The Bank of England decided to keep UK interest rates on hold at 5.5%. The decision allows the Bank to further asses the impact of recent rate rises. With inflationary pressures remaining, another interest rate hike is expected in the coming months.
The European Central Bank opted to raise its interest rates to 4% from 3.75%. This increase, which takes rates to their highest level for six years, was widely expected after members expressed their concerns over inflation. The statement from the ECB president indicated there may be a further rate rise this year but it was unlikely to be next month.
In addition to the UK and European central banks, the Federal Reserve chairman expressed his concerns that US inflation remained somewhat elevated. A cut in US interest rates, which was widely expected before the end of the year, has now been largely ruled out.
The outlook for inflation and the possibility of higher interest rates caused a sell-off in global bond markets and declines in world equities. Yields on government bonds rose to multi-year highs and the poor sentiment spread to equity markets, which suffered consecutive falls.
|
| |
|
Sarasin's week at a glance - 01 June 2007
|
|
Wednesday, 6 June 2007
|
General Market Analysis
|
It was announced that the US economy grew at a rate of 0.6% in the first three months of the year, the slowest rate since the fourth quarter of 2002. This figure was revised downwards from 1.3% as imports rose and supply stockpiles fell. Supported by strong stock markets, US consumer confidence was higher in May than in the previous month but concerns remained over inflation as petrol prices hit record highs.
In the minutes from its latest meeting, the US Federal Reserve reiterated its view that inflation is the “predominant concern” for the economy. Nearly all members thought that inflation was uncomfortably high and that further caution was required. This increased expectations that interest rates would remain on hold for some time.
The Chinese government tripled stamp duty on share trading from 0.1% to 0.3% on Wednesday in an attempt to cool its overheated stock markets. The Shanghai Composite Index, which has quadrupled in value since the start of 2006, fell 6.5% but recovered later in the week.
Global equity markets largely ignored the fall in Chinese stocks, with the S&P 500 and the Dow Jones reaching all-time highs. The S&P beat its previous record set at the height of the dotcom boom seven years ago. European markets fell slightly after the Chinese fall but takeover speculation helped them recover towards six-and-a-half year highs on Friday
|
| |
|
Sarasin's week at a glance - 25 May 2007
|
|
Tuesday, 29 May 2007
|
General Market Analysis
|
The minutes from the Bank of England’s May meeting revealed that all members of the committee voted for a quarter-point rise in the UK interest rate. Some members considered voting for a half-point increase but decided to wait and see what effect a quarter-point rise had. The BoE expressed their concerns over rising prices and wage pressures, which raised expectations of another imminent rate hike. News of a possible hike in June or July strengthened sterling against the US dollar and the Euro.
Housing data in the US showed that the sales of new houses in April rose by 16.2% to a fourteen-year high. However, at the same time, the average price of a new home fell by 11.1%. The strong house sales data, along with a rebound in business investment figures, lowered expectations that the Federal Reserve may cut interest rates later in the year. This news boosted the dollar against the Euro.
Global equity markets fell this week after the former head of the US Federal Reserve, Alan Greenspan, voiced his concerns that the Chinese stock market was overvalued and due for a dramatic contraction. His fears lowered sentiment and other equity markets saw some profit taking after their record breaking run. The yen benefited from the Asian equity weakness as increased risk aversion reduced investors appetite for carry trades.
Finally, oil prices rose above $71 as output from Nigeria was threatened by strikes and worries over Iran ’s growing nuclear activity.
|
| |
|
Sarasin's week at a glance - 18 May 2007
|
|
Thursday, 24 May 2007
|
General Market Analysis
|
The UK Consumer Price Index fell from 3.1% in March to 2.8% in April. The Retail Prices Index also fell to 4.5% from 4.8%. In its inflation report, the Bank of England warned that inflation risks remain in the medium term despite rises in interest rates and lower energy bills. Following the announcement, Sterling was weaker and UK equities rose.
Eurozone growth was solid in the first quarter of 2007. The area’s economy grew by 3.1% year-on-year - lower than the 3.3% recorded in the previous quarter but better than the 2.9% that was forecast.
In the US , CPI rose by 0.4% in April which was less than expected as higher petrol costs were offset by falls in goods such as clothing. This mild inflation data helped the Dow Jones break through the 13,400 mark for the first time and set another record high.
The Bank of Japan kept its interest rate on hold at 0.5% after lower consumer prices data. The Yen fell to a three-month low against the US Dollar as Japanese economic growth came in lower than expected. The Dollar was further boosted as the number of US jobless claims fell to their lowest level since February last year, weakening the case for a near-term interest rate cut.
|
| |
|
Sarasin's week at a glance - 11 May 2007
|
|
Monday, 14 May 2007
|
General Market Analysis
|
The Bank of England raised interest rates to 5.5% on Thursday, taking the UK’s cost of borrowing to its highest level for 6 years. The move was widely expected as the BoE tries to reduce inflation and calm consumer spending.
The European Central Bank decided to keep its interest rate on hold at 3.75%. ECB president Jean-Claude Trichet said that “strong vigilance” was needed to monitor the risk of rising inflation, indicating the possibility of another rate hike in June.
The US Federal Reserve also decided to keep its interest rate at 5.25% amid concerns over economic growth and a weak housing market. However, recent comments from the Fed have signaled that it may be prepared to cut rates later this year. It was also announced that the US trade deficit widened by more than expected in March as higher oil and petrol prices sent imports to near record levels. Following this news and weaker than forecast retail sales in April, US equities suffered their largest decline in two months.
The Chinese Shanghai Composite Index broke through the 4,000 mark for the first time on Wednesday while daily trading volumes were higher than the rest of Asia, including Japan. Many have expressed concerns of a “bubble” as retail investors pour into the market, opening almost 400,000 stock accounts a day.
|
| |
|
Sarasin's week at a glance - 04 May 2007
|
|
Monday, 7 May 2007
|
General Market Analysis
|
US productivity rose by 1.7% in the first three months of the year, exceeding expectations. There was also positive data from the US manufacturing sector which grew by more than expected in April. This helped restore some confidence in the US economy after previous data had shown that the US grew at its slowest pace in four years during the first quarter.
This data, along with better than expected earnings results and continued M&A activity, helped boost global equity markets. In the US , the S&P 500 broke through the 1,500 point barrier for the first time since September 2000. The Dow Jones also remained around record territory.
In currencies, the Euro was the biggest gainer as it reached its highest level against the Yen since it was launched. The rise came as the European Central Bank indicated that interest rates would increase in the coming months. The Euro also hit a record high against the US dollar last Friday following the weak US growth data. The dollar recovered some ground this week.
|
| |
|
Sarasin's week at a glance - 27 April 2007
|
|
Monday, 30 April 2007
|
General Market Analysis
|
In the first quarter of 2007, the UK economy grew by 0.7% compared to the final quarter of 2006. On an annual basis, the economy grew by 2.8%. This news, following last week’s inflation data, further increased the likelihood of a rise in UK interest rates.
The Japanese Central Bank decided to keep interest rates at 0.5% amid concerns about deflation. Japanese inflation was lower than expected in March, while consumer spending was also weaker. Following this news, the Yen fell to a record low against the Euro.
US Equity markets saw strong gains this week with the Dow Jones finishing above 13,000 for the first time in its history. Gains were driven by stronger than expected earnings from companies such as Apple, Boeing, and Amazon. The S&P 500 and Nasdaq also rose.
|
| |
|
Sarasin's week at a glance - 20 April 2007
|
|
Tuesday, 24 April 2007
|
General Market Analysis
|
Figures released this week revealed that the UK Consumer Price Index rose to 3.1% in March, prompting a letter of explanation from the governor of the Bank of England to the Government. Figures also showed that the wider ranging Retail Price Index rose to 4.8% last month. The governor, Mervyn King, said that rising oil and petrol prices were primarily responsible for the jump in inflation. On the back of the news, Sterling broke through the $2 mark to a 26 year high against the dollar.
In the US , inflation concerns eased slightly after figures showed that growth of the core inflation measure slowed in March. While most global equity markets saw mixed results, this US inflation news along with positive earnings reports from many companies helped lift the Dow Jones to a new all-time closing high.
While the Pound rose and the Euro remained near an all-time high against the dollar, the Yen also rallied following concerns over an overheating Chinese economy. China ’s economic growth soared to 11.1% in the first quarter increasing speculation that its government may raise interest rates to slow the rate of growth.
|
| |
|
Sarasin's week at a glance - 13 April 2007
|
|
Monday, 16 April 2007
|
General Market Analysis
|
The European Central Bank decided to keep interest rates at 3.75% indicating that it may wait and watch to see what happens to inflation over the coming months. Many analysts are expecting another quarter percent rise in June this year.
The Euro reached record highs against the Dollar and the Yen ahead of the meeting and strengthened further towards the end of the week. Eurozone government bonds fell following the ECB’s statement, while European equity markets were boosted by fresh M&A activity.
The latest minutes from the US Federal Reserve indicated that they see inflation as the “predominant concern” for the US economy. While further interest rate rises might be needed to control inflation, they also have concerns over weaker growth. US equity markets were mostly flat this week.
Meanwhile, the International Monetary Fund predicts that Japan will overtake US economic growth this year. They forecast that higher private investment, strong corporate profits and rising exports will push growth to around 2.3%, while its projection for US growth was lowered to 2.2%.
|
| |
|
Sarasin's week at a glance - 30 Mar 2007
|
|
Monday, 2 April 2007
|
General Market Analysis
|
Since the release of the minutes from the US’s FOMC meeting last week, when the monetary policy tightening bias was removed, the initial positive tone has been eroded somewhat. Equity and bond markets globally have drifted back to the pre meeting levels as oil prices have risen due to further tensions in the Middle East . Also Fed chairman Bernanke has sent mixed signals to the market by stressing that further policy moves would be data dependent, as per the minutes, yet commenting in a speech that inflation remains
uncomfortably high which begs the question why lift the tightening bias.
In the UK last weeks high retail sales data were still weighing on both bond and equity markets as they underperformed their European peers. The recent economic data across Europe has generally been positive but the concern remains on inflation pressures and both European and UK interest rate futures markets are now beginning to factor in further rate increases.
|
| |
|
Sarasin's week at a glance - 23 Mar 2007
|
|
Monday, 26 March 2007
|
General Market Analysis
|
In the UK , the minutes from the MPC’s March meeting revealed that the committee voted 8-1 in favour of keeping rates at 5.25%. At the same time, February’s inflation data showed that CPI rose to 2.8% from 2.7% in the previous month. There was a larger rise in the RPI, which increased to 4.6% from 4.2%. UK share prices reached a three-week high following Gordon Brown’s final budget, in which he announced cuts to income and business taxes next year.
In the US , the Federal Reserve also decided to leave interest rates unchanged at 5.25%. However, the language of the accompanying statement hinted that they may end their tightening bias as inflation fears subside. This news boosted US equity markets and caused the dollar to fall to a two-year low against the Euro and a six-week low against the pound.
As expected, the Bank of Japan kept interest rates on hold at 0.5% while inflation remains subdued. The weak Yen boosted export stocks which helped lift the Nikkei to a three-week high.
|
| |
|
Sarasin's week at a glance - 16 Mar 2007
|
|
Monday, 19 March 2007
|
General Market Analysis
|
It was another volatile week in global equity markets with sharp sell-offs followed by strong rebounds. This latest round of selling was sparked by concerns over the US sub-prime mortgage market. US data indicates that late mortgage payments and home repossessions are at record highs.
The falls were given further momentum after US retail sales rose by less than expected in February, signalling that consumer spending may be slowing down. However, US and European equity markets rebounded well on Thursday boosted by M&A activity.
The US also released data showing that producer prices rose by more than analysts’ expectations in February, driven mainly by rises in the cost of food, energy, and toys. The figures indicate that inflationary pressures are still strong and further interest rate rises may be necessary. US Treasuries weakened following the news.
In currencies, the US dollar weakened against the pound, euro, and yen.
|
| |
|
Sarasin's week at a glance - 9 Mar 2007
|
|
Monday, 19 March 2007
|
General Market Analysis
|
The Bank of England kept UK interest rates unchanged at 5.25% on Thursday while the European Central Bank chose to raise its rates to 3.75%. The BoE is believed to be waiting to assess the impact on inflation of previous increases before deciding their next move. The ECB’s move was widely expected and takes Eurozone rates to their highest level in five-and-a-half years.
Global equity markets all staged cautious recoveries following the recent sell-offs. Tentative gains in the US were boosted by signs of improved corporate profits and M&A speculation but concerns remained over many subprime mortgage lenders.
Following stronger equity markets and the ECB’s rate decision, US and Eurozone government bond prices softened.
The yen fell against the dollar as equity rallies and lower volatility soothed concerns over further unwinding of carry trades.
Oil prices were unaffected by last week’s sell-off and remained slightly above $60 a barrel.
|
| |
|
Sarasin's week at a glance - 2 Mar 2007
|
|
Thursday, 8 March 2007
|
General Market Analysis
|
Global equity markets experienced sharp corrections this week with many indices recording their steepest drop since 11th September 2001. The declines began after Chinese shares fell 9% following rumours of a crackdown on illegal share offerings and trading in the country.
US stocks were hit further when fourth quarter growth was revised down to 2.2% from 3.5% indicating that US growth may be slowing more than expected.
Unsurprisingly, US and European government bond prices rallied as investors looked for shelter from volatile equity market conditions.
The yen strengthened by 3% against the dollar this week, which was its largest gain since 2005.
|
| |
|
Sarasin's week at a glance - 23 Feb 2007
|
|
Monday, 26 February 2007
|
General Market Analysis
|
The minutes from the February MPC meeting revealed that the members voted 7-2 in favour of keeping UK interest rates on hold. The Committee said that it required more time to assess the impact of the shock rise in January.
US consumer prices increased more than expected in January despite a fall in energy prices. Figures showed CPI up 0.2%, while the Core CPI which excludes food and energy rose by 0.3%. US Treasuries fell after these figures and amid news of weak demand for new five-year notes.
The Bank of Japan decided to raise interest rates to 0.5% following signs of steady growth in the economy but highlighted that a further rise was unlikely until much later this year.
Most global equity markets fell this week with the main exception being the Nikkei. The index rose close to a seven-year high as investors saw the BoJ’s decision as a vote of confidence in the Japanese economy.
Following the BoJ’s comments, the yen fell to a record low against the euro and remained close to a four-year low against the dollar. Sterling received a boost as fourth quarter data showed that UK business investment grew at its fastest rate in a decade.
|
| |
|
Sarasin's week at a glance - 9 Feb 2007
|
|
Monday, 19 February 2007
|
General Market Analysis
|
As widely expected, the Bank of England decided to leave UK interest rates unchanged at 5.25%. The European Central Bank also kept its rate at 3.5% but President Jean-Claude Trichet’s comments indicated that a rise is likely next month.
In a good week for global equity markets, the FTSE 100 rose to 6-year highs on Friday. Gains were supported by resource stocks after a fire at a US oilfield pushed the oil price over $60 a barrel. In the US , the S&P 500 and the Dow Jones both reached record highs in midweek.
Gilts rose after the BoE’s decision while Eurozone government bonds fell amid expectations of further rate hikes. US and Japanese bond prices gained after auctions of new notes saw strong demand.
In currency markets, the pound and the yen weakened while the euro strengthened against the US dollar.
|
| |
|
Sarasin's week at a glance - 16 Feb 2007
|
|
Monday, 19 February 2007
|
General Market Analysis
|
UK inflation was lower than expected last month with CPI falling from 3% to 2.7% and RPI falling from 4.4% to 4.2%. In its inflation report, the Bank of England hinted that it is likely that interest rates will need to be increased once more to keep inflation in check.
Mr Bernanke’s biannual testimony to Congress, in which he forecast a soft landing for the US economy, boosted equity markets and bonds in midweek. The FTSE 100 continued upwards while the Nikkei also experienced gains following unexpectedly strong Japanese growth data.
In currencies, the yen rose to a one-month high against the dollar and, after the BoE’s inflation report, the pound strengthened against the euro.
|
| |
|
Sarasin's week at a glance - 2 Feb 2007
|
|
Wednesday, 7 February 2007
|
General Market Analysis
|
The Federal Reserve decided to keep US interest rates at 5.25% amid signs that the US economy was staying reasonably strong. Mild inflation figures and fourth quarter GDP growth of 3.5% helped reassure investors that interest rates are stable.
The positive economic data, along with some strong earnings figures, buoyed US equity markets with the S&P 500 reaching its highest level since 2000 and the Dow Jones touching its all-time high.
In other markets, the Nikkei reached a six-year peak on Friday morning while the FTSE 100 rose mid-week before receiving a further boost on Friday as a possible private equity bid for Sainsbury was announced.
US Treasuries were lower following strong housing sector data while gilts and Japanese bonds also fell.
The pound, the euro and the yen were all slightly stronger against the US dollar this week.
|
| |
|
Sarasin's week at a glance - 19 Jan 2007
|
|
Friday, 26 January 2007
|
General Market Analysis
|
Rising energy prices were responsible for jumps in both US and UK inflation in December. The UK Consumer Prices Index jumped to an 11 year high of 3%, increasing the possibility of further interest rate rises. Meanwhile, the Retail Prices Index, which excludes mortgage payments, rose to 4.4%. In the US, CPI rose to 2.5% after energy prices shot up 4.6% last month.
Most global equity markets fell this week with technology stocks leading US markets lower. The Nikkei was given a slight positive impetus after the BoJ’s decision to keep interest rates on hold at 25bps.
US Treasuries recovered a bit on Thursday after yields had touched three month highs, while both UK and European bonds lost ground amid concerns of further monetary tightening.
On the currency front, the pound advanced strongly and the yen continued to be under pressure. The yen is now touching four year lows against the US dollar and all-time lows versus the euro.
|
| |
|
Sarasin's week at a glance - 26 Jan 2007
|
|
Friday, 26 January 2007
|
General Market Analysis
|
Wednesday’s MPC minutes revealed that the committee members voted 5-4 in favour of the interest rate rise earlier this month. While this tight decision indicated that there may not be a further rise in February, fourth quarter GDP figures (up 0.8% from the previous quarter) showed stronger than expected UK growth, making another rise likely later this year.
Following these announcements, the pound eased from its 14-year high against the US dollar (having almost reached the $2 barrier) while UK equity markets rose.
Positive earnings results, especially from some notable technology stocks, drove US equity markets higher in the first part of the week. The Nikkei also rose to an eight month high in mid-week.
On Thursday, a lacklustre sale of new five-year US bonds pushed yields to five-month highs and caused equity markets to give up some of their previous gains.
The yen lost ground on Friday as weak inflation data lowered expectations of a possible rise in Japanese interest rates.
|
| |
|
Sarasin's week at a glance - 12 Jan 2007
|
|
Monday, 15 January 2007
|
General Market Analysis
|
We had a surprise rate increase of 25bp to 5.25% from the BoE this Thursday. We must assume that it is a strike against rising inflation and an attempt to cool down the overheated UK housing market. In Europe , the ECB left rates on hold and Jean-Claude Trichet, the ECB president, indicated he would wait until March before raising rates from the current 3.5%.
Oil prices have extended their decline this week and commodities have generally been weak so far this year.
World equity markets eased early in the week but gained strongly on Thursday, with the Nasdaq in particular continuing its positive start to the year. UK property shares lost some of the strong gains they made last month, while bonds maintained their weak tone.
On the currency front, the US Dollar has been stronger against the Euro, but Sterling powered to new highs against all the majors following the interest rate rise.
|
| |
|
Sarasin's week at a glance - 24 Nov 2006
|
|
Monday, 27 November 2006
|
General Market Analysis
|
Markets, this week, have been heavily influenced by holidays in both Japan and the US, consequently liquidity has been light. Coupled with very little in the way of top line economic releases markets have traded in fairly tight ranges. However with little else going on, focus seemed to switch back to currencies with the USD showing signs of weakness as it broke through a key level of 1.30 to the EUR and there was also speculation that China is re-allocating dollar assets into other currencies.
In the UK the main point of interest was the release of the Minutes of the last MPC meeting which showed that the margin of the decision to raise rates by 25bp to 5% was 7 to 2 (rather than the 8 to 1 which the market had anticipated), with 2 members voting for rates to be left on hold but the Committee remain with their cautious stance.
|
| |
|
Sarasin's week at a glance - 17 Nov 2006
|
|
Monday, 20 November 2006
|
General Market Analysis
|
US inflation data released this week was quite benign with consumer prices declining in October. This news continues to support the scenario of a soft landing with lower inflation and the Fed stance.
In Europe , although Q3 GDP was below expectations (0.5% vs. expected 0.6%) revisions to previous quarters continue to show a solid backdrop.
The Japanese GDP number was ahead of expectations (+2% yoy). There are however some concerns about consumption recovery as GDP growth was mainly driven by exports.
Generally, equities recorded a positive week, Nasdaq and the technology sector in particular. Bonds were slightly weaker.
|
| |
|
Sarasin's week at a glance - 10 Nov 2006
|
|
Monday, 13 November 2006
|
General Market Analysis
|
In the US , the Democratic party exceed expectations winning control of both the House and the Senate. This shift in power in Washington creates an environment in which policy changes are less likely to be implemented. This is generally considered positive for markets. Although, equity and bond markets have been quite resilient to the news so far. The US dollar saw some weakness by the end of the week as a reaction to comments made by the Governor of the Central Bank of China regarding the bank’s long-term plans to diversify FX reserves. Against the euro and Japanese yen the dollar is trading at 1.28 and 1.91, respectively.
The widely expected interest rate hike by the Bank of England this week caused little reaction. As growth remains firm and inflation above the 2.00% target, the markets are pricing a further hike to 5.25% early next year as growth remains firm and inflation remains well above the 2.00% target.
|
| |
|
Sarasin's week at a glance - 30 Oct 2006
|
|
Monday, 6 November 2006
|
General Market Analysis
|
Equity markets have continued to gain as a majority of companies so far have reported strong earnings ahead of estimates for the past quarter.
As expected, the US Federal Reserve held interest rates at 5.25% for the third consecutive month. However, the accompanying statement revealed less emphasis on inflation concerns than thought by the market and a view that the economy was likely to expand moderately. The subsequent rally for US Treasuries and the weakening of the US Dollar by as much as 1% against the Euro and Sterling would indicate that the market now expects interest rates to remain on hold this year and the next move could be down.
In Europe , the ECB is expecting to leave the repo rate unchanged next Thursday but is likely to raise it by 25bp in December.
The oil price rallied slightly at over $60 after a surprise fall in crude stockpiles.
|
| |
|
Sarasin's week at a glance - 3 Nov 2006
|
|
Monday, 6 November 2006
|
General Market Analysis
|
The US released further economic data which was on the soft side, with Purchasing Managers Indices coming out below expectations, but in general equity markets have been fairly resilient and are only marginally weaker with focus remaining on earnings and the increased possibility of monetary easing by the Fed in 2007. Bond markets were buoyed by the interest rate outlook and 1 year money market future rates have fallen by about 40 basis points in the last 10 days (implying more than 60 basis points of easing in 07), and the longer end of the curve saw yields fall by about 10 bp.
European equity markets showed little reaction to the ECB’s meeting which has clearly signalled a further rate hike in December. Bonds however performed well as a reaction to both the movement in US rate expectations and also the greater clarity from the ECB. Yields across the UK end European curves fell by 5 to 10 basis points.
|
| |
|
Sarasin's week at a glance - 20 Oct 2006
|
|
Monday, 23 October 2006
|
General Market Analysis
|
Evidence of core inflation creeping up and a slow down of industrial production in the US unsettled markets mid week but some strong corporate earnings from large companies such as Pfizer and Coca Cola helped the Dow index to break through 12,000 for the first time.
In the UK , the retail price index (RPI) rose to an annual 3.6% in September (an 8 year high) leading to expectations of a further interest rate increase by the BoE in November.
We remain convinced that large cap global equities offer attractive returns supported by compelling valuations, strong profits and continued M&A activity of private equity investors and corporate buyers notably from the emerging markets.
|
| |
|
Sarasin's week at a glance - 13 Oct 2006
|
|
Friday, 20 October 2006
|
General Market Analysis
|
Equity markets have continued to rally, with indices in the US and UK hitting five year highs.
Bond yields have been edging higher, especially after the release of the minutes from the latest FOMC meeting which showed that inflation remains a concern. This suggests cuts in US interest rates may not come about as quickly as many had forecast.
|
| |
|
Sarasin's week at a glance - 6 Oct 2006
|
|
Monday, 9 October 2006
|
General Market Analysis
|
Equity markets continued to rise this week, encouraged in part by a further fall in oil prices after data released this week showed US inventory levels to be higher than analysts expectations.
Whilst new jobs data in the US fell short of forecasts, stocking fears about the extent of the economic slowdown this was to some degree offset by positive revisions to both the July and August figures.
We retain our pro-equity bias.
|
| |
|
Sarasin's week at a glance - 22 Sep 2006
|
|
Tuesday, 26 September 2006
|
General Market Analysis
|
With further evidence that the US economy is slowing down and an expectation that inflationary pressures will recede, the US Federal Reserve kept rates on hold for the second month in a row.
On the back of this and, subsequently, the Philadelphia Federal Reserve's first negative business condition index reading for over three years, bonds had a very good week, especially in the US where 10yr US Treasuries now yield the same as 6 months ago. The US dollar has also renewed its downtrend against all major currencies.
Over the week, equities markets were mixed, but in general slightly lower in sterling terms.
|
| |
|
Sarasin's week at a glance - 15 Sep 2006
|
|
Monday, 18 September 2006
|
General Market Analysis
|
US and European equities recovered from last week’s fall, while bonds weakened slightly. Interestingly, US retail sales figures were stronger than expected, demonstrating once again the resilience of the US consumer despite higher interest rates and worries regarding their housing market. Lower oil prices translated into lower gasoline prices may have helped.
In contrast, weaker than expected economic data in Japan affected equities negatively and bonds positively earlier in the week. The continued easing of the oil price (-17% from recent peak) should reduce inflation fears and help economic growth on a global basis.
In the UK, inflation data and retail sales figures were strong raising fears that interest rates may have to be raised further by the BoE. Sterling strengthened against the dollar on the news.
Supported by a backdrop of stable bond yields, lower oil prices and a strong earnings picture, we are retaining our overweight stance on equities. We are also raising our exposure to Japan and Europe, while retaining our large cap, growth, bias.
|
| |
|
Sarasin's week at a glance - 8 Sep 2006
|
|
Monday, 11 September 2006
|
General Market Analysis
|
What with the Labour Day holiday in the US on Monday and the week being largely bereft of major economic data, equity markets gradually drifted lower over the week and bond yields gave up a small amount of their recent sizeable gains. Over the last few weeks the economic data has been on the soft side and concerns remain about the possible slowing of the US housing market and its perceived effect on asset prices.
In the UK, economic data was mixed and the UK's Monetary Policy Committee kept rates on hold as was heavily expected with little impact to markets.
|
| |
|
Sarasin's week at a glance - 1 Sep 2006
|
|
Monday, 4 September 2006
|
General Market Analysis
|
More US data this week continued to point towards slower growth and a peak in US interest rates. With a strongly hawkish rhetoric from the ECB, weak economic data in Japan and further rate hikes anticipated in the UK, bonds have had a very positive week (and month).
Equities also recorded positive returns over the week and August saw new highs in some areas. The technology sector was particularly strong after months of under-performance. Expectations for earnings growth in 2007 remain firm, despite the economic slowdown. While these may prove a little optimistic, a soft landing for the global economy should enable earnings to grow further, underpinning the already compelling valuation argument in favour of equities at current levels.
On the currency front, Sterling has remained strong against all major currencies. By historical standards Sterling is overvalued, though it is difficult to see the catalyst for weakness in the near term.
|
| |
|
Sarasin's week at a glance - 25 Aug 2006
|
|
Monday, 28 August 2006
|
General Market Analysis
|
More evidence of a weak US housing market dominated economic news this week. With the risk of a hard landing for the US consumer growing, it is becoming increasingly likely that we have seen the peak in US rates, even if inflation remains above the Fed's comfort zone. On the currency front, sterling remained strong against all major currencies as the possibility of further rate hikes were absorbed.
Bonds had a good week, especially in Japan after a rebalancing of their inflation basket produced a lower than expected figure, but equities leveled off after a very positive performance the previous week.
It was a relatively quiet week for corporate earnings, though BHP Billiton announced record earnings and predicted an extended bull market for commodities on the back of strong demand and limited new supply.
|
| |
|
Sarasin's week at a glance - 18 Aug 2006
|
|
Wednesday, 23 August 2006
|
General Market Analysis
|
Equities and Bonds around the world major markets have risen on the back of weaker than expected US inflation figures and a lower oil price. Also the Nasdaq has recorded an improvement of 4% in sterling terms over the past five days.
With US PPI and CPI figures reassuring, weaker gasoline demand and a housing market that is slowing down rapidly, the market is debating that the US Federal Reserve will again leave its interest rate on hold in September. Some commentators are even arguing that rates have peaked.
With second quarter earnings in the main exceeding expectations and valuations looking reasonable on both relative and absolute levels, markets might be able to consolidate after the second quarter setback.
|
| |
|
Sarasin's week at a glance - 11 Aug 2006
|
|
Monday, 14 August 2006
|
General Market Analysis
|
The decision of the US Central Bank to keep the interest rate unchanged at 5.25% and another threat of international terrorism resulted in another volatile week for equity and bond markets. Markets were slightly weaker overall.
The Fed has taken the view that the US economy is slowing down sufficiently and that inflation is not too bad. This view is not shared by all commentators, especially after recent data which showed a slowdown in US productivity and a sharp rise in unit wage costs. Hopes for a lower oil price were not helped by BP's forced shutdown of a major oilfield in Alaska due to leaks in its pipelines.
Although uncertainties remain, we continue to argue for a pro-equity stance at current levels. While the US economy is slowing, global growth remains sufficiently robust to drive earnings and dividends higher. This makes an attractively valued equity market even cheaper, in absolute terms and relative to other assets.
|
| |
|
Sarasin's week at a glance - 4 Aug 2006
|
|
Monday, 7 August 2006
|
General Market Analysis
|
Having spent so much of the recent period wondering whether the US Fed would raise interest rates again, investors were caught out by the UK's decision to hike rates on Thursday - the first increase in two years. This caused UK bonds and equities to sell-off, while Sterling strengthened against all currencies. Although the ECB also raised rates, this had been well flagged and investors took the decision in their stride.
Attention will now focus on the Fed and whether they will raise rates next week. At the moment, the odds seem close to 50% so we are likely to see an increase in volatility either way.
Sarasin have been pleasantly surprised by the strength of the Q2 earnings season, especially but not exclusively in the US. This has provided welcome support to the equity market during this period of interest rate uncertainty. The fundamentals continue to support a strong equity market and they look forward to greater clarity following next week's Fed meeting.
|
| |
|
Sarasin's week at a glance - 21 Jul 2006
|
|
Friday, 4 August 2006
|
General Market Analysis
|
Equity markets continued to recover over the week as sentiment improved in the light of Bernanake's comments that a pause in the tightening of monetary policy was close at hand. This was helped by the release of data that pointed to a continued slow down in the US housing market.
Despite some high profile disappointments, corporate earnings remain robust. In the US, the majority of S&P 500 companies that have thus far reported earnings have come in ahead of analysts' forecasts.
|
| |
|
Sarasin's week at a glance - 21 Jul 2006
|
|
Friday, 21 July 2006
|
General Market Analysis
|
Despite some stronger than expected inflation data from the US, new Federal Reserve Governor Ben Bernanke brought some calm back to all asset classes in his six monthly Monetary Policy Statement. His comments appeared to signal that a pause in the tightening of monetary policy was close at hand which sent a relief rally through bonds, commodities and equities alike.
In the UK there were also increases in inflation data and retail sales but this had a lesser impact on assets, which were still buoyed by the positive US outlook. The minutes of the last MPC meeting were released this week and showed a unanimous decision was reached to keep the base rate unchanged at 4.5%.
|
| |
|
Sarasin's week at a glance - 14 Jul 2006
|
|
Tuesday, 18 July 2006
|
General Market Analysis
|
With military clashes intensifying between Israel and Lebanon, the oil price hit a new high and global equity markets eased on the back of rising geo-political risk. Technology stocks were particularly weak after some disappointing earnings reports and broker downgrades from the sector leaders. Bonds were a beneficiary of the growing risk aversion and strengthened in all regions.
The Bank of Japan raised interest rates from zero to 0.25% for the first time in almost 6 years. Monetary conditions are still considered to be loose and should continue to support the economic recovery in Japan. Economic strength in Japan and Europe remains on track and should offset the impact of a slowdown in the US.
|
| |
|
Sarasin's week at a glance - 7 Jul 2006
|
|
Monday, 10 July 2006
|
General Market Analysis
|
By the standards of the past month or so, last week was relatively quiet. Equities were mixed, perhaps a little stronger on balance, though Japan and the technology sector saw profit taking. Bonds were steady.
Monetary policy continued to be the main talking point. While rates were not raised in the UK and Europe, speculation was rife that Japan would finally tighten next week while a forecast of strong employment growth in the US caused some commentators to conclude that rates would have to rise further. In the event, the payroll number was weak and bonds rallied. Equity markets were uncertain how to react, with the positive impact of lower interest offset by the negative impact of lower earnings growth.
Overall, while the global economy remains finally balanced we retain our pro-equity stance. Next week will be a key period for corporate earnings but as the pre-announcement season was quiet we would expect another good quarter, which should support equities over the summer.
|
| |
|
Sarasin's week at a glance - 30 Jun 2006
|
|
Monday, 3 July 2006
|
General Market Analysis
|
As expected, the Federal Reserve raised interest rates by 0.25% to 5.25% on June 29 and reiterated its stance that further increases would be data dependant and reflect the prospects for growth and inflation. This was the 17th consecutive rise.
The Fed indicated that the cooling of the housing market, the delayed effect of previous rate increases and high-energy prices would continue to slow economic growth, and stressed that inflation expectations remained contained. The message increased the probability that they would hold rates in August (though the market still attaches a 70% probability to another increase).
Investors were relieved by this more dovish message, and shares around the world rallied strongly. While volatility may remain high over the summer, the process of portfolio de-risking would appear to have come to an end. We are therefore minded to increase exposure to equity markets, while retaining a strong style bias toward defensive stocks, countries and sectors.
|
| |
|
Sarasin's week at a glance - 23 Jun 2006
|
|
Monday, 26 June 2006
|
General Market Analysis
|
The major equity markets rallied midweek following some positive news on corporate profits. Japanese stocks, that had been particularly weak in the previous few weeks, have bounced back strongly.
Nevertheless, investors continue to be worried about rising interest rates, inflationary pressures and the weakening US housing market, all of which would impact profit growth. We have also seen US treasury yields rising in anticipation that the Fed will increase rates next week and possibly again in August.
However, we continue to believe that global "Blue Chip" stocks offer very good value following their recent set back.
|
| Click here for original article |
| |
|
Sarasin's week at a glance - 16 Jun 2006
|
|
Monday, 19 June 2006
|
General Market Analysis
|
The start of the week saw a further sell-of in the equity markets as investors, nervous ahead of the release of a raft of inflationary data from the US and Europe continued to "de-risk" portfolios, with Japanese and emerging markets stocks hit particularly hard.
Although the inflationary data was slightly worse than analysts' expectations and all but confirmed economists predictions of a further rise in US rates at the end of June, equity markets were encouraged by Bernanke who sought to temper his previous hawkish comments on US inflation risks with remarks suggesting a more balanced assessment of price pressures in the US. He said that developments over US inflation "bear watching", emphasising the central bank's vigilance, but noted that knock-on effects from record oil prices had been "relatively low".
Following the market correction we believe equity valuations are appealing, as witnessed by a surge in corporate activity in the UK. We accordingly retain our pro-equity stance although we acknowledge that markets will continue to be volatile for the time being.
|
| |
|
Sarasin's week at a glance - 9 Jun 2006
|
|
Monday, 12 June 2006
|
General Market Analysis
|
This week has been dominated by talk of inflation and interest rates. The Fed, in particular, repeatedly expressed their concerns about the rising level of inflation, such that investors are now confident of another rate hike at the end of the month. Interest rates were raised this week in some of the emerging markets, such as India, Turkey, South Africa and Korea, and the Euro Zone.
Interestingly, while the highly -intensive bond market performed rather well this past week, equities fell sharply, as investors preferred to focus on the risk that rates will be raised too much and growth curtailed.
The general de-risking by investors is affecting Emerging Markets and Japan more than most, as investors have continued to take some of the substantial profits earned in the past year or so. Gold and Oil prices receded somewhat on the back of more diplomatic efforts with Iran and the death of Zarqawi in Iraq. On the currency front, the US Dollar recouped some of its recent losses against the Euro and Sterling.
|
| |
|
Sarasin's week at a glance - 2 Jun 2006
|
|
Monday, 5 June 2006
|
General Market Analysis
|
Although volatility in commodities and concerns over inflation have continued to affect markets, major indices, although still volatile, improved over the past week with the exception of the Nikkei 225 that lost a further 1.14% in Yen terms.
All eyes are on the economic data being released, the next key number being a report on employment in the US. The market is very much looking for clues as to the likely direction for interest rates. It certainly did not get much help from the latest Fed Minutes that revealed that either a pause or a rate hike by 50bp were possible, indicating that Fed officials are as data dependent as the market.
|
| |
|
Sarasin's week at a glance - 26 May 2006
|
|
Monday, 29 May 2006
|
General Market Analysis
|
Market volatility has persisted throughout the week but with little overall net effect, with the major market indices essentially moving sideways over the week. Emerging markets and small caps have continued to struggle, as investors have de-risked portfolios.
Bonds have benefited from their "safe haven" status as investors have sought refuge from the increased volatility with the US 10 year bond yield falling back to close to 5%. This was helped by the announcement of an unexpectedly large drop in US durable goods orders in April, which provided some relief for the market's fears of higher interest rates.
Whilst we expect market volatility to continue for the time being, economic conditions remain broadly supportive of equities and we continue to recommend an overweight stance.
|
| |
|
Sarasin's week at a glance - 19 May 2006
|
|
Monday, 22 May 2006
|
General Market Analysis
|
The past week has seen a significant setback in global equity markets, which to us was a combination of profit-taking - as falls were greatest in areas that had previously experienced the greatest returns - and a general "de-risking" of portfolios. It does not appear to have been the result of a deterioration in the fundamentals.
US core inflation did disappoint last week, with the annualised rate over the last three months rising to 2.8% - well above the comfort zone of 2% and the April figure of 2.3%. But if this was a genuine concern to investors it did not impact the asset of greatest sensitivity to inflation - bonds. In fact, bonds were stronger on the week, on a global basis and in the US.
Rather, we see this latest setback as being mainly technical in nature. The fundamentals as far as earnings growth are concerned have continued to exceed expectations while valuations remain attractive. It may be appropriate to reduce exposure to reflect the increased volatility in equity markets but we continue to recommend an overweight stance.
|
| |
|
Sarasin's week at a glance - 12 May 2006
|
|
Wednesday, 17 May 2006
|
General Market Analysis
|
Notwithstanding another very good period for earnings growth, bond and equity markets corrected this week. Concerns over Dollar weakness, high commodity prices and the Fed's comments on interest rate policy following the latest ¼ point rise to 5%, have unsettled markets. Although the Fed is signaling a possible pause, it has retained the option for further tightening, thereby increasing uncertainty within markets.
Gold has been a beneficiary of a weaken dollar. It has continued to rise and has reached a 25-year high this week.
Currencies have been no less unsettled. The Dollar has fallen sharply against the Yen, Euro and Sterling in the past few days, dropping in fact to its lowest level in a year against the Euro. There are renewed concerns about the deterioration in the US trade deficit.
|
| |
|
Sarasin's week at a glance - 5 May 2006
|
|
Tuesday, 9 May 2006
|
General Market Analysis
|
In a shortened week for UK and Europe and also the Golden week holidays in Japan there was limited activity with little change in global equity markets. There was selling pressure in the bond markets as new Fed Governor Ben Bernanke seemed to imply that he was misunderstood when he indicated there may be a pause in monetary tightening.
The market had assumed this to be an openly dovish stance from Bernanke and had previously rallied but after the weekends comments there was pressure across the curve with 10 year yields rising to 5.15%. Markets have also been focused on this afternoons employment report which may give greater direction now that the Fed insists it is more data dependent.
Both the UK and Eurozone elected to leave rates unchanged at 4.5% and 2.5% respectively but once again Mr Trichet affirmed his vigilant stance and general hawkish sentiment.
|
| |
|
Sarasin's week at a glance - 28 Apr 2006
|
|
Tuesday, 2 May 2006
|
General Market Analysis
|
The weakness of the US dollar was the major news this week. European and Japanese equity markets were also softer as were bonds.
On Thursday, China surprised the market by raising interest rates. It unsettled commodity markets, as the country is seen as one of the major driver to the current surge in commodity prices.
Later on the same day, there was no surprise with the outlook for economic growth and inflation in the testimony from the Chairman of the Fed. As expected, he appeared to prepare the markets for a pause in interest rate hikes. The US dollar weakened further and equities rallied slightly on the news.
US quarterly earnings reporting season is well under way with 336 of the S&P500 companies having reported - so far with 70% above expectations, 17% neutral and 13% negative.
|
| |
|
Sarasin's week at a glance - 21 Apr 2006
|
|
Friday, 28 April 2006
|
General Market Analysis
|
Equity markets around the world were very strong this week, but the US Dollar was weak following a comment from the Fed that suggested that we may be near the end of rate increases. We expect the Fed to pause after another hike in May (to 5%).
The IMF upgraded its estimate for world output (PPP-adjusted) from 4.3% to 4.9% in 2006 and to 4,7% in 2007 which was also positive for markets. Energy and Commodity prices also reacted positively, reaching record highs on the back of further supply worries and a 10,2% surge in China's first quarter GDP. 10 year US Treasuries traded over 5% while Japanese Government Bonds briefly traded at 2% for the first time since 1999.
Sarasin expect another quarter of strong corporate earnings and retain our double overweight stance on equities, with a particular bias towards large and super cap growth stocks, especially in the US.
|
| |
|
Sarasin Chiswell House Report - April 2006
|
|
Friday, 28 April 2006
|
General Market Analysis
|
Despite a month of rising bond yields, rising interest rate expectations and higher equity market volatility we are pleased that we have retained our equity content at or close to maximum levels. Continued strong profit and dividend growth across all major markets coupled with an abnormally high equity risk premium leaves us confident that our decision to lift equity weighting was correct. Much as we had hoped record levels of merger activity have underpinned equity valuations, with global takeovers now totalling an extraordinary $920 billion this year, 54 percent more than the same time a year ago (note that of this an abnormally high proportion are structured as cash only bids). Amidst this euphoria we certainly have seen corrections in some higher risk assets including speculative emerging equity markets (including the Gulf region and most recently Iceland) as well as higher volatility across many emerging market currencies. But this has had little impact on the major Western equity markets or indeed on Western world bond spreads (normally a good barometer of overall risk appetite).
|
| |
|
Sarasin's week at a glance - 7 Apr 2006
|
|
Tuesday, 11 April 2006
|
General Market Analysis
|
Global equities were mixed on the week with gains from Asian and Japanese markets and some limited upside in Europe. There was fairly subdued action in the US ahead of today's Employment report due out this afternoon. Bond yields have been edging higher as Central Banks appear to be showing a more hawkish stance on interest rates.
Both the European Central Bank and the Bank of England's MPC kept rates on hold at 2.5% and 4.5% respectively. In Europe there remains uncertainty as to the speed of rate hikes from the ECB as they head for a "normalised" rate. Many commentators had already raised their expectations but Mr Trichet, in yesterdays post meeting press conference, was less than forthcoming and, if anything, appeared less hawkish than was expected leading to some volatility in the long end of the European Bond Markets.
|
| |
|
Sarasin's week at a glance - 31 Mar 2006
|
|
Tuesday, 4 April 2006
|
General Market Analysis
|
As we end the first quarter of 2006, we are pleased to note another solid and above benchmark quarter for our flagship Funds. Our positive bias toward equities has worked particularly well for our actively managed balanced Funds.
Equity markets have been mixed during the past week, though Japan (+3%) continued its process of recovery following weakness earlier in the quarter. The Nikkei closed the quarter at an almost 6-year high. Mining stocks also rose on the back of higher commodities prices. Gold rose above $580 for the first time in 25 years, but other long-term highs were also recorded for silver, copper and zinc.
In the US, the Fed raised rates by another 25 basis points to 4.75% and stated that some further policy tightening may be needed. The Fed added that economic growth had rebounded strongly in the first quarter but appeared likely to moderate to a more sustainable pace.
10-year bond yields rose sharply on the week, with the US and EU rates registering increases of between 15 and 20 basis points.
|
| |
|
Sarasin's week at a glance - 24 Mar 2006
|
|
Monday, 27 March 2006
|
General Market Analysis
|
The best main equity market this week was Japan with the Nikkei 225 index up 2.89%. Positive news continues to prevail in that country. Of particular interest, the rate of decline in land prices has slowed and in fact some areas are seeing appreciation. The European equity markets were slightly positive but the US was fairly flat. Ten-year bonds yields were hardly changed on the week for all the major markets.
In the UK, the Budget provided better than expected news for the UK property sector. The Chancellor announced that REITs (Real Estate Investment Trusts) would come into being on 1st January 2007 with more lenient rulings on gearings and conversion changes. The listed property sector took this news positively and was up sharply on the day. Our property funds are continuing to receive good inflows on the back of excellent performance numbers and positive sentiments for the commercial real estate sector.
|
| |
|
Sarasin's week at a glance - 17 Mar 2006
|
|
Wednesday, 22 March 2006
|
General Market Analysis
|
On the week of the third anniversary of the current bull market, the major global equity markets advanced further amid continued mergers and acquisitions activity and positive economic data. The US Fed Beige Book indicated that the US economy was expanding at a moderate pace and price pressures are still subdued and the market felt the Fed might not raise rates as much as predicted recently.
For our asset allocation strategy, we are sticking to our maximum overweight equity call and our underweight bond call. We have however adopted a more conservative stock selection angle, looking for lower beta (volatility) large and "super-large" stocks with a clear focus on "traditional growth sectors" including technology, telecoms, pharmaceuticals, as well as capital goods and selected financials where we see under-valuation compared to smaller companies.
In economic terms, the global picture remains strong with global growth in excess of 4% and where mild inflationary pressures in the Emerging world have yet to impact consumer prices in the West. The greatest risk for us remains political pressure over the highest ever US current account deficit of $225bn representing, 7% of gross domestic product.
|
| |
|
Sarasin's week at a glance - 10 Mar 2006
|
|
Monday, 13 March 2006
|
General Market Analysis
|
The main news this week has been in Japan, where bank lending rose for the first time since 1996 and the Bank of Japan announced a phased-end to its period of quantitative easing. This suggests that officials believe a decade of deflation may be over. At the same time, investors were reassured that monetary policy would not be tightened too rapidly. The Nikkei 225 index climbed 2.9% in Yen and 2.1% in GBP on the week.
In the US, data remains strong, whilst Euroland retail confidence surveys are pointing upward and consumer sentiment is recovering. In the UK, the Bank of England left interest rates unchanged.
It was a volatile week for emerging markets, with widespread declines in debt and equity markets as risk aversion spiked. This bout of profit taking was triggered by speculation that the US Federal Reserve will raise rates more aggressively than had been expected. Although they have performed well and benefited from large inflows we think that emerging markets will be well supported on any significant correction, as the fundamental attractiveness of the asset class remains intact.
|
| |
|
Sarasin's week at a glance - 3 Mar 2006
|
|
Friday, 10 March 2006
|
General Market Analysis
|
In the Eurozone, moves in the equity market seem to have finally caught up with the economic picture, as it was announced that the economy will grow at the fastest pace since 2000. The ECB now believes that growth will be at 2.1% this year, compared to previous expectations of 1.9%. Consequently, interest rates were raised by 25bps for the second time in 3 months, causing a sell off in the bond market.
Elsewhere in Japan, consumer prices were seen to rise at their fastest rate in eight years. This could indicate a possible end to deflation which has been discouraging bank lending and investment for so long. It is now essential for equity investors that the BOJ do not choke the potential reflation of the economy by raising interest rates too fast.
|
| |
|
Sarasin's week at a glance - 24 Feb 2006
|
|
Thursday, 2 March 2006
|
General Market Analysis
|
A positive week for equity markets overall with the Nikkei index broadly recovering its losses of the previous week. Continental Europe indices were also slightly up whilst the US and the UK markets were fairly flat.
The German business confidence index continued its uptrend, rising to its highest level in more than 14 years this month. The reading comfortably outstripped expectations. Rising confidence among manufacturers and retailers was behind the improvement aided by benefits of corporate restructuring and a more competitive Euro. Reflecting the improved economic situation, investors are expecting the ECB to raise interest rate to 2.5% next week and bond yields rose slightly on the week.
In the UK, the BOE Minutes revealed a 8-1 vote to leave rates unchanged. Members are concerned that a reduction in interest rates would provide further support to the housing market. We remain more cautious on growth than the BOE and still expect the next rate move to be down rather than up.
|
| |
|
Sarasin's week at a glance - 17 Feb 2006
|
|
Monday, 20 February 2006
|
General Market Analysis
|
Equity markets were slightly firmer this week, with the exception of Japan. The Nikkei 225 index continued to show volatility and ended down some 3% on the back of profit taking and speculation that the Bank of Japan may end their ultra accommodating monetary policy. The most recent news - that Japan's economy grew five times faster than the US in Q4 2005 on the back of good export numbers and a rebound in consumer spending - merely confirmed these fears.
Euroland GDP growth slowed in Q4 2005, but is expected to improve in Q1 2006.
In the US, Fed Chairman Bernanke sees some leveling out in the housing market but remains optimistic about the wider economy. However, in the face of rising capacity utilisation, he requires flexibility for potentially further rate hikes.
In the UK, retail sales figures were weak after Christmas and bond rates eased slightly. We still see a rate cut soon.
|
| |
|
New theme for Sarasin portfolios
|
|
Monday, 20 February 2006
|
Official Announcement
|
Global Convergence has been introduced as a new theme for EquiSar, Sarasin's Global Thematic Fund. The theme seeks to capitalise on the dramatic convergence in real interest rates between the emerging and developed world, which is speeding up global growth and making it more resource and capital intensive.
Why are real interest rates converging? Very simply, the integration of the emerging world's labour supply into the world's production cycle is restraining global inflation and global interest rates, setting into motion a virtuous cycle that lifts global growth. The dynamics are particularly attractive for the emerging world - booming trade surpluses and foreign exchange reserves along with implicit dollar pegs are compressing risk premia and borrowing costs to unprecedented levels. Today, emerging market spreads are under 200bps over US Treasuries, from more than 1600bps in 1998. With investment costs in capital-starved Brazil, Russia, India and China being set by monetary policy in capital-rich Japan, Europe and the US at absurdly low levels, the virtuous global growth cycle is gaining further traction.
As interest rates, particularly real ones, for the faster growing emerging world converge with those of developed countries, not only will the region enjoy an extended boom, but global growth dynamics are also likely to be significantly impacted. Specifically, global convergence implies that global growth is likely to be faster, more capital hungry and resource intensive. Strategies that specifically target such investment and growth trends are likely to benefit disproportionately. At the same time, the complete converse of globalisation, the localised good, service or asset that cannot be substituted globally is likely to enjoy secular reflation.
|
| |
|
Sarasin's week at a glance - 10 Feb 2006
|
|
Wednesday, 15 February 2006
|
General Market Analysis
|
Equity markets closed slightly higher on the week with little influence from economic fundamentals but rather from an increase in speculation of LBO and merger and acquisition activity. Notably an approach to BAA from Spanish company Gruppo Ferrovial sent the shares markedly higher. Also Portugal Telecom has been targeted by a private equity firm Sonae.
In the UK the Bank of England's MPC left rates on hold at 4.5% as expected and demand is still firm in the bond markets for longer dated issues. This is also becoming the case in the US where they have issued their first 30-year "Long Bond" for 5 years.
|
| |
|
Sarasin's week at a glance - 3 Feb 2006
|
|
Monday, 6 February 2006
|
General Market Analysis
|
Sentiment was lifted in the US in January, as employers were expected to add 250,000 new jobs, leaving unemployment at a 4 year low of 4.9%. Employment rose at factories for the fourth consecutive quarter, the first occurrence for nearly 8 years. The move is expected to increase concerns that the combination of a high oil price and lack of spare capacity within the system will bolster inflation, adding pressure on the Fed to further increase interest rates. (Source: Bloomberg)
Russian giant, Gazprom, which already supplies a quarter of Europe's gas, confirmed on Thursday that it was considering the purchase of Centrica, the UK utility. The bid for the Centrica will undergo intense governmental scrutiny, as it would effectively see control of Britain's largest power supplier fall into the hands of the Russian government. At one stage, Centrica's shares were seen up nearly 25% on the news.
|
| |
|
Sarasin's week at a glance - 20 Jan 2006
|
|
Monday, 23 January 2006
|
General Market Analysis
|
After a good run which resulted in a 5 year high of 16455 last Friday, the Nikkei index dropped by 6.7% over 3 days (before regaining 2.3% yesterday). It fell on reports of an alleged fraud at Internet service provider, Livedoor, on the news that consumer confidence had dropped back in December and on the back of weaker than expected results from Intel and Yahoo.
In the UK, consumer price inflation declined back to the BoE's target of 2%. With growth slowing and inflation in check, it may allow the BoE to cut rates sooner rather than later.
Despite a volatile week, equities remain our asset of choice for Q1 2006. We particularly like the US, large cap growth, technology and healthcare. We remain under-weight bonds and recommend short duration but feel that a significant sell-off is unlikely. Within bonds, we prefer the UK and inflation protected bonds in the US. Gold and Real Estate are our preferred alternative assets and we recommend at least a market weight position in energy as a hedge against a further spike in oil prices.
We are pleased to report a positive start to the year across our range of funds, both in absolute terms and relative to their respective benchmarks. This is particularly gratifying given their excellent performance in 2005.
|
| |
|
Sarasin's week at a glance - 13 Jan 2006
|
|
Monday, 16 January 2006
|
General Market Analysis
|
This week saw very few economic or market sensitive data releases and was consequently very quiet. Global equity markets were broadly unchanged and bond markets yields were stable.
The UK's Monetary Policy Committee kept rates on hold at 4.5% as expected. It will be interesting to see the minutes of this meeting, when they are released in 3 weeks, to see if the MPC feel that the single 25 basis point of easing last year has been enough to steady the economy and whether this months positive moves in both house prices and retail sales may lead to a more hawkish stance.
|
| |
|
Sarasin's week at a glance - 6 Jan 2006
|
|
Monday, 9 January 2006
|
General Market Analysis
|
Markets began the New Year on a positive note with equity indices up strongly and bond yields moving lower. Much of this was as a result of the release of positive minutes of last months US Federal Reserve meeting. The Fed softened its tightening stance and much of the 'hard line' language, which has been standard over the last year. It stated that policy was no longer accommodative and that future rate movements will be made on a more 'data dependent' basis. Although a rate increase in the US is still expected this month the probability of further hikes has been reduced from March onwards. Today sees the release of the US Employment Report, which may provide some direction for markets but it would take a significant shock to any element of this report for markets to react strongly after the FOMC minutes.
In the UK the FTSE rose to its highest level since August 2001 having risen by nearly 16% over 2005. The gilt market continue to see significant buying interest in longer dated maturities, inverting the curve further as 30 year yields drove through the 4% level and currently lie at about 3.90%.
|
| |
|
Sarasin's week at a glance - 16 Dec 2005
|
|
Tuesday, 3 January 2006
|
General Market Analysis
|
With economic activity still solid in the US, the Fed raised rates by another 25bp to 4.25%. On inflation, red lights are still flashing, but the FOMC sees pressures dependent on resource utilisation and energy prices.
During the past few days, we have seen much window dressing by investors as the year unwinds. The Japanese market, the US Dollar and Gold, having done well over the past few weeks, were targets for profit takings and fell back somewhat.
|
| |
|
Sarasin's week at a glance - 02 Dec 2005
|
|
Monday, 12 December 2005
|
General Market Analysis
|
Economic data this past week confirmed the strength of the US economy, raising the likelihood that interest rates will have to rise further than anticipated. We saw some profit taking in equities at the beginning of the week but markets rallied strongly on Thursday ending flat on the week. Of particular interest was the continued strength of the Japanese equity market. The Nikkei index is 33% higher since the beginning of July 2005.
The European Central Bank raised interest rates by 25bp to 2.25% - a first hike in 2 ½ years. This was widely expected by the market and therefore had little effect on financial assets. With GDP growth predicted to be 1.9% for 2006 and inflation at 2.1%, the ECB President, Trichet, indicated that a series of rate increases was not on the cards yet.
|
| |
|
Sarasin's week at a glance - 09 Dec 2005
|
|
Monday, 12 December 2005
|
General Market Analysis
|
After a few strong weeks, the past one has been quiet for economic data and financial markets. Of note has been strong manufacturing numbers from Germany and strong productivity numbers from the US. In equity markets, we have seen some profit taking.
Gold continues its upward move and is currently at US$523. The US Dollar fell slightly after policy makers in Japan and Europe suggested they would raise borrowing costs, reducing a gap with the Fed benchmark rate.
|
| |
|
Sarasin's week at a glance - 25 Nov 2005
|
|
Tuesday, 29 November 2005
|
General Market Analysis
|
Ahead of the US Thanksgiving holiday, equities continued to be strong with new 4 year highs for the S&P 500 and Nasdaq and a 5 year high for Japan.
Bonds and currency movements have been relatively modest, but the US dollar remains firm especially against the yen. The Japanese Finance Minister said that deflation persisted and that the Japanese Central Bank should cooperate to keep its interest rates low.
In Europe, Jean-Claude Trichet, in his annual testimony before the EU Parliament, said that the ECB Council was unanimous and ready to raise the repo rate as the latest data confirmed a gradual recovery in Euroland. In contrast, the BOE reduced its growth and inflation forecasts further and the future direction of UK rates is clearly down. Turning to the US, the latest Minutes from the Fed suggest that we are getting closer to the end of the rate increases, despite few signs of an economic slowdown.
|
| |
|
Sarasin's week at a glance - 18 Nov 2005
|
|
Monday, 21 November 2005
|
General Market Analysis
|
This past week has seen a strong US dollar, a gold price hitting a new 18 - year high and a better bond market. A positive industrial production report in the US combined with a drop in oil prices also reassured investors, supporting further gains in equities. Of note was the Japanese market where the Topix index reached a 5-year high with Real Estate stocks gaining most.
Bond yields fell across the board, most notably in the UK and in Japan following the Bank of England scaling down slightly its inflation expectations and the Japanese Finance Ministry suggesting that the Bank of Japan may be getting ahead of itself in contemplating a tightening of policy.
|
| |
|
Sarasin's week at a glance - 11 Nov 2005
|
|
Monday, 14 November 2005
|
General Market Analysis
|
Inflation numbers are still being scrutinised carefully, but with the oil price falling, US consumer confidence rising and Japan's economy expanding faster than expected, it has been a positive week for equities. Note that Japan's Nikkei 225 has risen to a 4 year high and the S&P 500 is at its highest level this quarter.
US bond yields, having been pushed higher over the past few weeks, appears to have reached a peak in the short term and have actually fallen in the past days, indicating renewed interest from investors.
In Europe, the Bank of England and the ECB left interest rates unchanged as the weaker tone to growth mitigates the stronger inflation data.
Real interest rates have turned in favour of the US dollar and together with French riots and German Government woes that have undermined the euro's merits, the US dollar continues to rise.
|
| |
|
Sarasin's week at a glance - 4 Nov 2005
|
|
Tuesday, 8 November 2005
|
General Market Analysis
|
In the US, as widely expected, rates were increased for the 12th consecutive time to 4%. The Fed downplayed the risks of inflation, brought about by the billions being spent rebuilding the areas destroyed by hurricanes Katrina and Rita, but remaining with the "measured pace of policy accommodation removal" wording in the accompanying statement. The implication of this is that there will be further rate hikes in the next few months until the perceived policy accommodation has been removed.
This week has seen a surge in corporate activity with bids being announced for O2, Pilkington, Mowlem and P&O. On the back of this the UK markets have risen 2.2% thus far this week, recouping much of the losses from earlier in the month. The recovery is being reflected overseas with the main European indices making gains and the Nikkei 225 up nearly 4.5% this week.
|
| |
|
Sarasin's week at a glance - 28 Oct 2005
|
|
Monday, 31 October 2005
|
General Market Analysis
|
The Wall Street favourite candidate to replace Alan Greenspan in 2006, namely Mr Ben Bernanke was nominated by President Bush and the US market moved up well on the day of the announcement.
Otherwise, a "choppy" past week for equity markets as we move through the reporting season for 3rd quarter earnings. Note that some companies are surprising negatively by quoting higher input costs. Overall, the world index is slightly up in USD terms and slightly down in GBP terms, the USD having been weak over the past few days.
Government bonds, especially in the US and Europe, have risen further. The 10 year US Treasury Bond yield is now at 4.54 and is 20 bp higher than the 10 year UK Govt Bond yield. The UK outperformed with money moving from mainland Europe.
|
| |
|
Sarasin's week at a glance - 21 Oct 2005
|
|
Tuesday, 25 October 2005
|
General Market Analysis
|
The week saw international equity markets come under strong selling pressure as fears that rising global interest rates would affect profit growth. The falls were centred mainly round the energy and mining sectors but momentum selling led to profit taking across the board. The MSCI World index (in Sterling terms), fell 2.58% over the week (source: Bloomberg/SIML).
Despite these falls we see continued strong company fundamentals going forward, particularly in global large 'cap' growth stocks like pharmaceuticals, technology and selected financials, but we are conscious to protect the gains made in the Sarasin Funds this year, and will use any rally from these levels to reduce equity weightings to a single overweight stance.
Meanwhile inflation concerns also led to US Treasury bond yields rising further on Friday in expectation that the Federal Reserve Bank would continue to raise rates at its next meeting in early November. As a result we continue to maintain our short duration stance on fixed income positions and remain positive on corporate bonds. We are also now taking opportunities to invest in inflation-protected bonds, particularly US TIPS.
|
| |
|
Sarasin's week at a glance - 14 Oct 2005
|
|
Monday, 17 October 2005
|
General Market Analysis
|
Bonds have been weak over the past week as inflation concerns rose again. We expect inflation to continue climbing at both the headline and core levels across all major economies and we are currently assuming an ongoing inflation rate of more like 3% to 4% rather than the 1% to 2 % we have got used to over the past few years.
Equity markets indices have overall registered a second week of decline, except for the Japanese market that bounced back on Tuesday following strong machinery orders.
The US Trade balance deficit rose, but less than expected. However the trade deficit with China continues to widen further to US$ 18bn.
|
| |
|
Sarasin's week at a glance - 7 Oct 2005
|
|
Monday, 10 October 2005
|
General Market Analysis
|
After a strong 3rd quarter 2005, equity markets fell on fears that the US plans to keep raising interest rates as inflation is becoming a worry, mainly due to high energy prices. Japan, many emerging markets as well as the energy and property sectors recorded the biggest falls, but at the same time they had been amongst the best markets and sectors in recent months.
In Europe and the UK, both the ECB and the BoE kept rates unchanged. However, comments and recent economic data differed such that the next move in rates is expected to be up in Europe and down in the UK. The Euro rose as a result.
In light of the above, some risk was removed from portfolios by reducing equity exposure in the case of the balanced funds and by selling some of the higher beta stocks in the equity funds.
|
| |
|
Sarasin's week at a glance - 30 Sep 2005
|
|
Monday, 3 October 2005
|
General Market Analysis
|
Once more there were mixed data releases in the US, but this was very much a knock on effect of the recent hurricanes, with consumer confidence falling dramatically. However, there were increases in durable goods orders and personal consumption. The effect of this was a fairly positive one throughout global equities with the Japanese markets outperforming (up nearly 4% on the week) and bond yields began to retrace from their recent lows.
In Europe the IFO survey of Business Confidence was mildly higher than expected, lending a positive tone to equities but the German unemployment rate continues to rise (currently at 11.7%) which is likely to dampen any over-enthusiasm as is the continued stalemate in the political arena. The UK saw a fall in GDP to 1.5% year on year and also a continuation of the slowdown of house price inflation.
|
| |
|
Sarasin's week at a glance - 23 Sep 2005
|
|
Monday, 26 September 2005
|
General Market Analysis
|
Markets have been particularly focused on the weather forecast this week. The imminent threat of hurricane Rita sent oil prices higher, bond yields lower and equities lower, as investors positioned themselves. The possible damage that could be caused to the country's energy infrastructure, if the hurricane made landfall in Texas, was driving markets. Despite the imminent threat of Rita and the after-effects of Katrina the US Federal Reserve continued on its upward interest rate path and increased the Fed funds rate by 25 basis points to 3.75%.
Europe's equity markets were also depressed by the situation in the US but to a lesser degree and bond markets made an attempt to go below yields of 3% on the 10 year German benchmark. In the UK, the MPC left rates unchanged at 4.5% with a unanimous decision but still remains concerned about a possible correction in the housing market and consumer debt.
|
| |
|
Sarasin's week at a glance - 16 Sep 2005
|
|
Monday, 19 September 2005
|
General Market Analysis
|
In general, economic data was on the soft side, certainly in the US where the knock on effect of hurricane Katrina is beginning to affect data. Equity markets were either flat or slightly lower on the week apart from the Japanese market, which rallied post last week's election concerns. The German elections are weighing on sentiment in Europe with recent polls indicating a close result.
Next week the US Federal Reserve will meet and, although there has been much speculation, is likely to continue raising rates in a measured fashion but the accompanying press release will be key. Having fallen dramatically post Katrina, Fed fund futures markets have retraced and now factor in a 90% probability of rates being raised by 25 basis points.
|
| |
|
Sarasin's week at a glance - 2 Sep 2005
|
|
Monday, 5 September 2005
|
General Market Analysis
|
The Katrina hurricane in the Gulf of Mexico and its effects on the oil supply to the US market and the oil price in general dominated the news. Furthermore, economic data reported out of the US were weaker and the US dollar fell sharply as interest rate hike expectations were scaled down.
It was a good week for bonds. US bond yields and especially short dated bond yields fell the most on speculation that the Federal Reserve Bank's interest rate increases are near an end.
In light of the above, equities remained surprisingly resilient on the back of acquisition activities, liquidity and a strong energy sector.
|
| |
|
Sarasin's week at a glance - 12 Aug 2005
|
|
Monday, 15 August 2005
|
General Market Analysis
|
Despite a new all-time high for the oil price, equity market indices were up again on the week. Of particular note was the 4% rally in Japan, following stronger economic data and the Prime Minister's decision to dissolve parliament.
In the US, the Federal Reserve Bank rate was raised by another 25bp to 3.5%. The Fed warned, "pressures on inflation are elevated". It described monetary policy as "accommodative" and keeps its views that the "pace" of future rate hikes is likely to be "measured". Further rate increases are therefore to be expected.
The US Dollar weakened slightly, especially against Sterling. Renewed concerned about the US trade deficit appears to be the main reason.
|
| |
|
Sarasin's week at a glance - 5 Aug 2005
|
|
Wednesday, 10 August 2005
|
General Market Analysis
|
Positive sentiments towards equities have continued to prevail this week on the back of more corporate earnings results and strong cash flows for many companies, despite an oil price that is above $60 a barrel. Noted too, was a slight weakness in bonds late last Friday.
German factory orders rose strongly in June and confirms sentiment indicators that the cycle has turned and that growth is likely to reaccelerate again. This was enough to kill off the final hopes for a rate cut from the European Central Bank this week.
In the UK, as widely expected, the Bank of England responded to the recent weakness in its economy by cutting rates by 25 basis points to 4.5%. This was the first move in the Bank's rate for a year. The press statement cites subdued output in Q1, 2005 and the slowdown of household spending and business investments.
|
| |
|
Sarasin's week at a glance - 29 Jul 2005
|
|
Monday, 1 August 2005
|
General Market Analysis
|
This week, although fairly light in terms of economic data, a marginal upturn in some of the European consumer confidence releases gave a slight boost to equity markets. Despite the consumer confidence figures in the US coming in lower than expected, equities continued to edge higher on the back of positive corporate earnings results.
Currency markets continue to show greater volatility with the uncertainty surrounding the exact make up of the new Chinese currency peg basket. Sterling has also come under pressure as many investors are of the belief that the MPC is more likely to cut the base rate at next weeks meeting.
|
| |
|
Sarasin's week at a glance - 22 Jul 2005
|
|
Monday, 25 July 2005
|
General Market Analysis
|
Yesterday, China revalued its currency, the Renminbi, by 2.1% versus the US Dollar. Furthermore, in future, the currency will float against a basket of currencies. This is the first step to appease pressure from the US and other major economies and it should be regarded as a positive move for global equities and emerging market currencies.
In the US, Fed Chairman Greenspan repeated his judgment that the economy was on a firm footing and as such the process of "measured" rate increases is likely to continue.
In the UK, the release of the Bank of England's Minutes of their last meeting revealed that 4 members out of 9 voted in favour of a rate cut (compared to just 2 in June). The likelihood of a rate cut is therefore gaining momentum, despite strong UK retail sales in June having just been reported.
|
| |
|
Sarasin's week at a glance - 15 Jul 2005
|
|
Monday, 18 July 2005
|
General Market Analysis
|
Post last weeks terrorist attacks in London, the increase in both market resolve and liquidity brought about a slightly positive equity performance over the week in the UK. Bond markets continued to drift back to the yield levels seen prior to last Thursday but remain at fairly low levels, 10yr Gilt at 4.30%.
Global bond and equity markets showed a similar picture with little in the way of economic data or corporate surprises. Many eyes are focused on next Wednesday's report on the Economy by Chairman Greenspan to see if any indications of future Fed policy can be found.
|
| |
|
Sarasin's week at a glance - 1 Jul 2005
|
|
Monday, 4 July 2005
|
General Market Analysis
|
Crude oil reached another record high of $60.75 at the beginning of this week following fears of a strike in Norway and comments made by Iran's newly elected president. Equity markets stalled going into the final days of the quarter on the back of this but regained some ground following evidence of increased inventories, allaying fears of a supply shock and pushing the oil price down to below $57.
Meanwhile the US dollar continued its recent gains following the US Federal Reserve's quarter point increase in interest rates. As the Fed continues to maintain a tightening bias to its monetary policy all eyes will turn to the Bank of England and the European Central Bank to see if rate cuts are likely in order to cope with slowing economic growth and falling consumer confidence.
|
| |
|
Sarasin's week at a glance - 17 Jun 2005
|
|
Wednesday, 29 June 2005
|
General Market Analysis
|
The oil price continues to dominate the news, having reached US$60 a barrel for the first time this week in New York. Although inventory levels are high, we note the analysis by Bernstein Research, which includes capacity utilisation in its pricing model and arrives at a fair value close to $50 a barrel. We therefore challenge the consensus that oil prices are likely to fall substantially in the coming months.
Given the volatility of the oil price (and the fact that it may fall towards $50 again) we are not recommending a change to our pro-equity stance. However, to reflect the possibility of a further spike, we recommend reducing the risk slightly within portfolios, specifically by:
- lowering equity exposure in absolute return mandates
- reducing the beta of equities through the sale of consumer stocks and those companies whose costs are negatively affected by the high oil price.
|
| |
|
Sarasin's week at a glance - 17 Jun 2005
|
|
Monday, 20 June 2005
|
General Market Analysis
|
The US, European and Japanese equity markets enjoyed another upward move this week. Of particular note was the steady appreciation of commodity and energy prices, whilst gold moved higher on the back of the G8 finance ministers' announcement that they would not sell gold to provide financial assistance to Africa.
We are beginning to question the value investors are likely to receive from holding long dated fixed interest at today's yields. As a result, we are reducing duration in favour of various shorter dated fixed interest instruments.
In our asset allocation strategy, we are retaining a "double overweight" recommendation on global equities at the expense of fixed interest and alternative assets (with a strategic holding in energy). We also continue to like global real estate whilst looking to protect investors from the overvaluation in the US.
|
| |
|
Sarasin's week at a glance - 10 Jun 2005
|
|
Monday, 13 June 2005
|
General Market Analysis
|
In an otherwise uneventful week, as far as economic data was concerned, market participants focused on Fed Chairman Greenspan's economic testimony to the Senate, hoping to glean any further hints on the direction of monetary policy. Few were forthcoming. Mr Greenspan very much upheld the recent FOMC meeting's beliefs, reiterating the gradual reduction of policy accommodation. Equity markets were generally unmoved by this and although bonds had rallied intra-week there was some profit taking to leave markets unchanged on the week.
In the UK, the MPC left the Base Rate unchanged at 4.75%, which came as no surprise to the markets. In fact looking at short-term interest rate futures, this is expected to be the case for some time to come and by year end, markets are factoring in prospects of rate cuts.
|
| |
|
Sarasin's week at a glance - 3 Jun 2005
|
|
Tuesday, 7 June 2005
|
General Market Analysis
|
This week, although short with the exception of Europe, proved to be one full of interest especially in the currency markets. The French and then the subsequent Dutch resounding No votes on the adoption of the new EU Constitution dealt a hammer blow to the Euro, although much of this had already been factored in with the currency having weakened by over 8% since the beginning of the year versus the USD prior to the Referenda. Both bond and equity markets rallied with little attention paid to matters of constitution.
Economic data was weak in general with German retail sales falling, poor ISM manufacturing data out of the US and weak confidence surveys from the UK. The ECB left rates on hold at 2%, a rate that has now been in place for 2 years. The most important economic release will be this afternoon's US Employment report, which is very much in focus. The consensus expectation is for an increase of 175,000 jobs but, as ever, estimates are significantly varied.
|
| |
|
Sarasin's week at a glance - 27 May 2005
|
|
Monday, 30 May 2005
|
General Market Analysis
|
After last weeks strong tech lead equity rally in the US, markets marked time this week in the light of little fresh or surprising economic data. The bond markets, specifically the US, were squeezed higher pushing 10 year yields all the way in to 4%, nearing the February lows, before settling at the 4.07% level. The minutes of the Federal Open Market Committee shed little light on forward looking fed policy.
European Markets showed a similar pattern as above, but with continued speculation on the French EU constitutional referendum result and the impending German elections causing some concern, markets were a little quieter, although both bonds and equities drifted higher. European 10 year yields have fallen to just 3.31%.
In the UK we saw the first issuance for over 40 years in 50 year maturity Bonds. Due to the inverted UK yield curve this issue was priced 11 basis points lower than the current 2038 issue and will likely attract significant life assurance / pension company interest.
|
| |
|
Sarasin's week at a glance - 20 May 2005
|
|
Monday, 23 May 2005
|
General Market Analysis
|
First US PPI and then CPI had its influence on the markets but in general markets were positive in both equity and bonds as the rather overblown concerns about hedge fund unwinding / losses dissipated. Then the real buying returned to the markets certainly in credit bonds and equity.
In the UK we saw the release of the MPC minutes showing that rates were kept on hold by a ratio of 9 to 1 rather than the 8 to 2, which was evident last time. This, although Mervyn King's statement was inconclusive, implies this is the case for some time to come.
|
| |
|
Sarasin's week at a glance - 13 May 2005
|
|
Wednesday, 18 May 2005
|
General Market Analysis
|
A confusing week that was bond positive and equity negative. In the US, disappointing earnings from Wal-Mart Stores overshadowed a report reflecting retail sales having risen much more than economists expected. We also had a US March trade deficit reported down unexpectedly (from USD61bn in February to USD55bn in March).
In the short term, the US dollar has continued its rally against the euro and has now hit a six months high. Sterling was also weaker against the US dollar and the oil price fell below $49 a barrel.
Listed property funds and property shares performed particularly well in the week and this is reflected in the unit prices of our global property funds.
|
| |
|
Sarasin's week at a glance - 3 May 2005
|
|
Wednesday, 4 May 2005
|
General Market Analysis
|
Global markets have been rather jumpy this week reacting to a mixed bag of economic data, with the US very much in the forefront due to next weeks Federal Reserve meeting. Of note US GDP statistics were not encouraging for US growth bulls, the growth/inflation trade off seems to be deteriorating. As a result equity markets have generally been weaker globally and Government bond performance has been flat to positive.
In Europe concerns still remain focused on the upcoming French vote on the new European constitution and its possible effects on the single currency. This weeks German IFO survey did nothing to indicate any likely upturn in the Euro economies with slightly lower expectations reported. The main topic in the UK, of course, is next weeks General Election but with very few data releases equity markets have generally drifted and bonds have been positive following the more global trend.
|
| |
|
Sarasin's week at a glance - 22 Apr 2005
|
|
Monday, 25 April 2005
|
General Market Analysis
|
The past week has been dominated by the release of Q1 2005 company results. After initial disappointments, the tide appears to have changed with two-thirds of results coming in better than expected. The Dow, S&P500 and Nasdaq rallied by more than 2% on Thursday on the back of this news. Overall, however, it has been a choppy week for equity markets, which also registered a higher oil price and continued weak economic data.
Corporate bond spreads followed the gyrations of the equity market and significantly tightened towards the end of the week.
Sterling has been strong on the back of a higher than expected inflation number which might push the Bank of England to raise interest rates further. This is however not our view.
|
| |
|
Sarasin's week at a glance - 15 Apr 2005
|
|
Monday, 18 April 2005
|
General Market Analysis
|
Despite a sharp fall in the oil price, equities also fell in value this past week. Investors became increasingly concerned about the economic and earnings slowdown, demand for commodities waning and a smaller than expected increase in US retail sales. Weaker than expected earnings from IBM and Samsung did not help either. On the positive side, many pharmaceutical and utilities stocks have bounced back from recent levels.
On the bond front, government stocks have been strong, but corporate bonds have fallen with spreads widening on the back of weaker equity markets and negative sentiment from the US auto and retail markets generally.
|
| |
|
Sarasin's week at a glance - 8 Apr 2005
|
|
Monday, 11 April 2005
|
General Market Analysis
|
With the oil price easing and inflation remaining well contained, we have enjoyed a positive week for equities and bonds across all the major markets. Both the ECB and the BOE left rates on hold this month suggesting that they are comfortable with the balance between growth and inflation.
On the currency front, the US dollar has held to its recent gains against the euro and the yen, providing a more stable backdrop for financial assets.
|
| |
|
Sarasin's week at a glance - 1 Apr 2005
|
|
Monday, 4 April 2005
|
General Market Analysis
|
The stuttering recovery of the Japanese economy was hit on Friday, as confidence among Japan’s large manufacturers unexpectedly fell to the lowest level in a year. Following a 13 year high in September 2004, the Tankan index saw it’s biggest drop since September 2001, reflecting concerns that rising oil and commodity prices are going to threaten the recovery. Whilst the Nikkei 225 rose 0.5% on the day, it remained down for the third week in succession.
After offering the market brief respite at the beginning of the week, the oil price traded above USD55 for the second consecutive day, on concerns that US gasoline demand could outpace inventories. Adding further fuel to the fire, Goldman Sachs produced a report that oil could reach as high as USD105 a barrel. The rise also came at a time when demand traditionally decreases moving into the summer months.
|
| |
|
Sarasin's week at a glance - 24 Mar 2005
|
|
Tuesday, 29 March 2005
|
General Market Analysis
|
As expected, the US Federal Reserve increased interest rates on Tuesday by another quarter point to 2.75%, thereby continuing their policy of raising rates at a 'measured' pace. However, with inflation pressures building, both equity and bonds markets reacted negatively and the US dollar strengthened notably.
As the oil price has remained in the mid 50’s, we have slightly been reducing our equity exposure across our balanced funds and mandates as a measure of prudence. While equities continue to be our preferred asset class, the risks for an oil-induced economic and earnings slowdown is clearly rising.
|
| |
|
Sarasin's week at a glance - 18 Mar 2005
|
|
Tuesday, 22 March 2005
|
General Market Analysis
|
Once again commodity prices, especially that of oil which reached new highs intra-week, played a large part in dictating the direction of both bond and equity markets. Equity market direction was generally lower, more so in the US, as inflationary thoughts were once again at the fore. Bonds were generally unchanged over the period and focus has now shifted to next weeks Fed meeting where a rate hike of 25 basis points is expected but the all important wording of the accompanying statement will be under scrutiny.
In the UK Chancellor Brown's Budget statement had little effect on the markets but the announcement that the Treasury will be looking to issue 50 year maturity bonds was of interest, although generally expected. Retail sales data came in marginally better than expectations but market reaction was modest. Next weeks release of the minutes of the latest MPC meeting will be closely watched for any evidence of further splits in policy thoughts.
|
| |
|
Sarasin's week at a glance - 11 Mar 2005
|
|
Monday, 14 March 2005
|
General Market Analysis
|
Rising oil prices and fluctuations in currency markets impacted on both bond and equity markets. Bond Yields pushed higher at the longer end of the curve and equity markets fell as the fear of increased inflation gave cause for concern. US Treasury markets were not helped by comments from Japanese Prime Minister Koizumi that Japan may consider diversifying its foreign currency reserve positions.
In the UK the Monetary Policy Committee left rates unchanged again at 4.75%. This decision itself was not unexpected but the minutes of this meeting will make interesting reading when they are released in three weeks time after last month’s majority decision. In general UK and European assets fell on the week but overnight the oil price does appear to be coming down from its highs and may inspire a rally into the weekend.
|
| |
|
Sarasin's week at a glance - 4 Mar 2005
|
|
Tuesday, 8 March 2005
|
General Market Analysis
|
The focus for equity markets is still on oil and corporate earnings. In spite of an oil price currently at around USD53, equities indices improved slightly over the week, with a particularly good performance in Japan.
The ECB has kept its interest rate at 2% amid slowing economic growth and inflation. Rising unemployment continues to hold back the pace of growth in Europe.
In general, bond yields have maintained the higher levels reached in February and the market is now awaiting the US payrolls data due out later today to decide on its next move.
|
| |
|
Sarasin's week at a glance - 25 Feb 2005
|
|
Monday, 28 February 2005
|
General Market Analysis
|
Cold weather in the Northern Hemisphere and "unhelpful" comments out of Saudi Arabia ensured that the oil price climbed above USD50, depressing equity markets as a result. This trend has reversed in the past two days, however, on speculation that the US Q4 GDP will be revised upwards and on the back of renewed M&A activities. Excellent earnings and dividend growth has persuaded us to retain our double overweight position in equities, although we may reduce exposure if oil continues to trend higher.
In the UK, bond yields continued to rise during the week as investors became less confident that interest rates have peaked. We remain cautious of longer-dated bonds and will continue to shorten maturities in portfolios.
On the currency front, sterling and the euro strengthened against both the yen and the US dollar.
|
| |
|
Sarasin's week at a glance - 18 Feb 2005
|
|
Monday, 21 February 2005
|
General Market Analysis
|
In his testimony speech to the Senate on Wednesday, Fed Reserve Chairman Alan Greenspan reiterated that interest rates are relatively low. We must conclude that the Fed will continue hiking rates through 2005. Our forecast is for a rate of 3.5% by year end (currently 2.5%). This, to our mind, would not destabilise the growth in the US economy although it will moderate it. The US dollar strengthened slightly against the euro on the news but subsequently weakened.
February so far has been a very positive month for equities. It is also pleasing to report that all our global funds, namely EquiSar, GlobalSar, Income Portfolio and Global Property are ahead of their respective benchmarks year to date.
|
| |
|
Sarasin's week at a glance - 11 Feb 2005
|
|
Monday, 14 February 2005
|
General Market Analysis
|
The FTSE 100 broke through the psychological barrier of 5000 on Thursday this week, with a continuation of some strong corporate data in the reporting season, signaling a two and a half year high for the index. The market gleaned further support from the Bank of England, who kept interest rates on hold for the sixth month in a row.
Expectations of an increase in the oil price gathered pace this week, according to a Bloomberg survey. The number of crude oil traders expecting an increase doubled to 34%, due to increased demand and declining inventories. The March future also traded up 1% to $47.10 on the week to Thursday. Fourteen of the last 19 surveys have correctly predicted the market’s direction.
|
| |
|
Sarasin's week at a glance - 7 Feb 2005
|
|
Wednesday, 9 February 2005
|
General Market Analysis
|
On 3 Feb 2005, Shell announced the greatest ever profit from a UK company, along with higher dividends and a USD5bn share buyback. However, this news was outweighed by a further announcement that their reserves were shy by 1.5bn barrels of oil. This was significantly higher than analysts estimates of 900m barrels and caused the share price to close 1.5% lower on the day.
After some encouraging performance last week the equity markets continued to rise strongly on Monday, following comments from Federal Reserve Chairman, Alan Greenspan, which decreased concern on the current account deficit. Subsequently, the dollar rose to its highest level against the euro since 5 Nov 2004, thus increasing the value of European companies' sales in the US, when converted back into euros.
|
| |
|
Sarasin's week at a glance - 21 Jan 2005
|
|
Monday, 31 January 2005
|
General Market Analysis
|
A quiet week for financial assets that ended up with a bang with the announcement from Procter and Gamble that it was taking over Gillette in a USD57bn deal.
The earnings season is fully underway, with positive surprises exceeding negative ones by a factor of 4:1 but investors were reluctant to buy equities ahead of the elections in Iraq. The high oil price also continues to be of concern.
In the UK, the Q4, 2004 GDP figure was positive but still sluggish at 0.7% on the back of weaker consumer and production data. The service sector continued to be the growth driver.
|
| |
|
Sarasin's week at a glance - 26 Nov 2004
|
|
Wednesday, 1 December 2004
|
General Market Analysis
|
The US dollar slipped to record lows against the euro this week, amid ongoing concerns on the US Trade Deficit and a lack of clear US economic data. However, the EU currency did retrace from USD1.33, where it peaked on Thursday, following a scotching of the report that the Chinese Central Bank had sold down its US Treasury Holdings. The dollar was weak against all currencies, hitting a nine year low against the Swiss franc, a four and a half year low against the yen and a sixteen year low against the NZ dollar. Furthermore, Gold bullion prices were seen to rise to a 16 year high of USD452.75. As yet there has been no indication that Central Banks are ready to support the Dollar.
A disappointing fall in the IFO Business Confidence figure in Germany yesterday, gave further credence to the argument that that the recovery in the European economies was losing momentum. German business leaders cited the strength of the euro and high oil prices as their primary sources of concern, ironically, on the same day that the euro hit record highs against the dollar. This anxiety is reflected in German bond yields, with the ten year note now yielding 3.8%.
|
| |
|
Sarasin's week at a glance - 19 Nov 2004
|
|
Tuesday, 23 November 2004
|
General Market Analysis
|
Currency movements have dominated the week with the US dollar weakening further against sterling, the euro and in particular the Japanese yen.
UK retail sales declined by more than expected which again tends to reduce the case for further rate hikes by the Bank of England, and this view was supported by disappointing guidance from Dixons for the crucial Christmas period.
Half way through the current final quarter of 2004, it is pleasing to note that our Global Thematic Equity Funds have performed strongly. Our double overweight move in equities against benchmark for our asset allocation, implemented straight after the US election result is also helping the performance of our GlobalSar Balanced and Income Portfolio funds. A sharp set back in US bond yields or the US dollar would however force us to reconsider our current policy.
|
| |
|
Sarasin's week at a glance - 12 Nov 2004
|
|
Monday, 15 November 2004
|
General Market Analysis
|
Global equity markets have continued to rally following the Republican victory despite the expected increase in US interest rates by 0.25% to 2%. Commodity prices and the US$ have also continued the recent downtrend providing additional support to equity markets. The bond market was fairly flat this week with the 10 year US Treasury yield adding only 4 basis points.
In the UK, the interest rate set by the Bank of England appears to have peaked at 4.75% as the residential housing market shows increasing signs of a slowdown.
|
| |
|
Sarasin's week at a glance - 5 Nov 2004
|
|
Monday, 8 November 2004
|
General Market Analysis
|
The uncertainty relating to the closely run US Presidential Election finally came to an end as George W Bush was re-elected. As expected US, and to some extent global, equity markets saw the Republican victory in a positive light and rallied into the end of the week. The rally was given a further boost today with October's non-farm payroll figures from the US. These came in at 337,000 - nearly double consensus forecasts. Bond markets reacted negatively, as the news fuelled expectations that the Fed would now increase interest rates twice before the end of the year. The US ten-year Treasury bond yield rose to just under 4.20%.
In the UK the Monetary Policy Committee decided not to adjust interest rates and continue to focus on the signs of a possible slowdown in the housing market. This was well flagged but weak industrial activity data continues to point to the fact that we may be at the top of the current interest rate cycle.
|
| |
|
Sarasin's week at a glance - 29 Oct 2004
|
|
Monday, 1 November 2004
|
General Market Analysis
|
A combination of a fall in the oil price and a series of good corporate results, particularly in Europe, saw equities rally strongly over the week. These two changes to the market, coupled with a move in most major indices above their 50 and 200 day moving averages mean that Sarasin's three primary criteria for an increase in the equity weighting within their balanced portfolios have now been fulfilled. Consequently, equities now represent 64% of the GlobalSar Sterling portfolio.
The People’s Bank of China surprised the markets yesterday with their first interest rate increase in nine years in an attempt to help cool the fast growing economy. The benchmark rate was raised by 0.27% to 5.58%. The market reacted well to the move, with positive comments from US Treasury Secretary, John Snow and Japanese Finance Minister, Sadakazu Tanigaki saying that it would hopefully cool Chinese growth, without hurting the global economy. China currently represents 12% of world output.
|
| |
|
Sarasin's week at a glance - 22 Oct 2004
|
|
Monday, 25 October 2004
|
General Market Analysis
|
The US dollar has renewed its weakness on the news that investors added to their holdings of US assets in August at the slowest pace since October 2003 and that the trade deficit figure has worsened further. The crude oil price has remained near its recent peak and the bond market continues to benefit due to the negative implication for growth. Note the US 10 year Treasury yield went as low as 3.91% yesterday.
Turning to equities, the S&P500 is now higher than in mid-August when oil was at USD48. It does not quite feel like it with all the caution on surging oil prices, but the market has indeed been ignoring oil and followed bonds.
Of interest too is the Chinese GDP growth number that has remained robust at 9.1% in Q3, 2004 and some good technology stocks results that have helped the Nasdaq to move up by 2.66% over the past week.
In the UK, rate hikes are starting to take their toll on the housing market but UK retail sales reported this week are still strong.
|
| |
|
Sarasin's week at a glance - 1 Oct 2004
|
|
Monday, 4 October 2004
|
General Market Analysis
|
Once more the impact of oil prices gave the markets reason for concern as the $50 per barrel level was again broken, albeit briefly. This time it was the bond markets turn to suffer with technical and currency driven selling seen in the US Treasury market pushing 10 year yields up from sub 4% levels to the current 4.15%. Equities however, despite some company specific negative news, were mildly higher on the week, with Far Eastern markets helped by a positive Japanese Tankan report.
In the UK the recent strength of Sterling was tempered as moderating house price inflation and recent Bank of England rhetoric gave the impression that the MPC may well be at, or very near, the end of the current interest rate cycle.
|
| |
|
New theme for Sarasin portfolios
|
|
Monday, 27 September 2004
|
Official Announcement
|
In line with Sarasin's policy to review and evolve their global investment themes on a continuous basis, they have introduced a new theme "Intellectual Property & Innovation. This theme has been established to capture shareholder value generated by superior product innovation. Sarasin aim to identify companies that consistently outperform competitors in terms of generating, protecting and exploiting intellectual property assets. At the same time, Sarasin have decided to discontinue the "Survival of the Fittest" theme. Sarasin believe this theme to be less relevant now in the light of the global economy responding strongly to monetary and fiscal stimuli. The "Profiting from Deflation" theme has been renamed to "Cash Flow Opportunities". This is to reflect the changed world economic circumstances in part evidenced by central banks moving from a defensive stance as regards the fears of deflation with the risk of inflation and deflation now considered to be equally matched.
|
| |
|
Sarasin's week at a glance - 24 Sep 2004
|
|
Monday, 27 September 2004
|
General Market Analysis
|
As was widely expected, the US Federal Open Markets Committee hiked the Fed Funds rate by 25 basis points to 1.75%. As this was fully discounted by the markets, the focus was on any change in the wording of the accompanying statement. The economic growth language was, if anything, slightly less positive than some previous Fed member comments and with this there was good bond buying interest in the longer end of the curve, taking 10 year yields below 4% for the first time since April. Equity markets were mixed but slightly slanted to the downside, especially in the US, as a rising oil price reared its ugly head once more.
In the UK there was yet more evidence of a slowdown in the property market from the RICS House Price data which showed a far weaker figure than was expected. Property was also referred to in the minutes of the UK's Monetary Policy Committee's last meeting in which rates were left on hold with a unanimous vote. The Committee pointed to the increased risk of a "significant correction in house prices" and made no mention of further hikes at present.
|
| |
|
Sarasin's week at a glance - 17 Sep 2004
|
|
Monday, 20 September 2004
|
General Market Analysis
|
Crude oil posted a 2.5% gain in the week to Thursday, as Hurricane Ivan heavily disrupted the transportation of oil over the week. Expectations are that the price may retreat next week as tankers resume shipments and OPEC looks to raise its output by 1 million barrels to 27 million barrels a day. The knock on effect of the high oil price has been highlighted in Europe by ECB President, Jean Trichet, as August’s inflation figure hit 2.3%, the fourth month in a row that it has exceeded the ECB’s self imposed ceiling of 2%.
In the UK, Sterling looks set to post an unlikely weekly gain against the Euro, the first for three weeks. This follows the higher than expected retail sales figure for last month, showing an increase of 0.6%, against consensus expectations for a fall. The unexpected rise has led to speculation of a further increase in UK interest rates, despite the cooling down of the housing sector and other indifferent economic data.
|
| |
|
Sarasin's week at a glance - 10 Sep 2004
|
|
Monday, 13 September 2004
|
General Market Analysis
|
The main market interest this week was on Chairman Greenspan's testimony of the current economic situation. Although the bond markets were braced for a "hawkish" tone to the speech, it was not so, and if anything, contrary to some previous Federal official’s comments, Greenspan was understated in his economic outlook saying that he would not be in favour of accelerating the current measured pace of rate hikes. Bond markets rallied at this news and equities remained broadly flat.
In the UK the Monetary Policy Committee surprised nobody by leaving rates on hold at 4.75% and the consensus view is that they will not consider any further movement in rates until after November's quarterly inflation report. Europe continues to show little sign of economic improvement with data across member nations still failing to impress.
|
| |
|
Sarasin's week at a glance - 3 Sep 2004
|
|
Monday, 6 September 2004
|
General Market Analysis
|
Global equity markets have generally remained range bound this week as attention has been fixed on today’s Non-Farm Payroll figures from the US, which saw 144,000 jobs being created in August. Although this was below consensus estimates of 150,000 it was much better than July’s figure of 32,000.
This figure provides evidence that the US economy is continuing to grow, albeit at a slower pace than the first half of 2004, and means that a third interest rate rise this year remains a possibility when the FOMC meets on 21 September.
Bond prices generally rose over the week on the back of weak economic data elsewhere within the US. The 10 year US Government benchmark bond yield touched a five month low of 4.08% but this should be held in check on the back of the payroll figures. Within Europe bonds hardly reacted to the ECB’s announcement that rates would stay on hold at 2% yesterday.
Sterling weakened against major currencies on the back of an industry survey showing a reduction in UK house prices. The payroll figures in the US added to this effect pushing sterling weaker against the dollar to around USD1.78.
|
| |
|
Sarasin's week at a glance - 27 Aug 2004
|
|
Monday, 30 August 2004
|
General Market Analysis
|
We saw a generally positive week for global equity markets with very little economic data to react to and there was finally some let up in the recent surge in oil prices. In fact, oil gave up a great deal of ground and was down over US$6 per barrel on the week and currently lies at the US$43 level.
Bond markets were mixed with yields rising in the earlier part of the week as oil prices fell and equities rose but regained most of those losses with comments from Central bankers indicating we may be near the end of the current tightening cycle.
|
| |
|
Sarasin's week at a glance - 20 Aug 2004
|
|
Wednesday, 25 August 2004
|
General Market Analysis
|
Once more, the main driver of markets appeared to be the oil price which kept rising and has reached a new high of nearly USD49 per barrel. The question of stability in Iraq and the general energy supply concerns have seen new oil price highs almost daily. Global equity markets have in general moved higher over the week but uncertainties of the sustainability of the current recovery still loom.
After the strong performance of the last few weeks, global bond markets retain their strength and yields have continued to fall as economic data releases appear to be flagging very few inflationary pressures.
|
| |
|
Sarasin completes acquisition of Chiswell
|
|
Tuesday, 1 June 2004
|
Official Announcement
|
The acquisition of Chiswell Associates by Sarasin Investment Management was completed on 27 May 2004. The integration of both companies in London is currently in progress. The new trading name Sarasin Chiswell is in the process of being adopted for activities undertaken by the combined firm in the UK. Further bulletins will be issued in due course.
Management
On completion, Mr Robert Brown and Mr David Kidd from Chiswell will be invited to join the board of the newly merged company as directors working alongside the current directors of Sarasin. Other senior members of the board from Sarasin will include Mr Franz von Meyenberg (Chairman), Mr Guy Monson (Group Chief Investment Officer) and Mr Thomas Service (Chief Executive Officer).
Together with the Sarasin executive management, the executive management of Chiswell will be participating directly in the equity of the enlarged UK company. It is planned that the combined UK management will hold a 25% stake. The remaining 75% will be held by Bank Sarasin with whom the UK management will work in partnership.
|
| |
|
Sarasin purchasing Chiswell
|
|
Monday, 15 March 2004
|
Official Announcement
|
Sarasin Investment Management announced on 9 March 2004 that they have entered into an agreement to acquire Chiswell Associates Limited. This agreement is subject to regulatory approval and completion is expected within the next three months.
|
| |
|
Sarasin's week at a glance - 27 Feb 2004
|
|
Monday, 1 March 2004
|
General Market Analysis
|
Markets stabilised at the end of the week after a correction in the US after stronger than expected US data last Friday. The Japanese market in particular has been strong on the back of improving economic fundamentals and the recent spike in the dollar versus the yen.
Bond markets have remained in their trading range, helped by more smoothing words from Greenspan on Thursday and by calls from European leaders for the ECB to cut rates. It is interesting to note that volatility of both bonds and equities has reduced dramatically in 2004.
|
| |
|
Sarasin's week at a glance - 13 Feb 2004
|
|
Monday, 16 February 2004
|
General Market Analysis
|
The Bank of England released its quarterly inflation report which was fairly upbeat on the economic outlook but expects inflation to rise above its 2% target rate by 2006 using the new harmonised measure. This was fairly neutral for equities but was negative for the short end of the bond markets as the current rate stands at 1.3% and the target implies an unhealthy increase. Governor King also gave strong implications of further base rate increases in the future in his following press conference.
There was only limited effect of the Bank of England's inflation report on markets as most investors were more concerned with Fed chairman Alan Greenspans bi-annual testimony to Senate and Congress committees. This was the real market mover even though there was very little said that was new. Greenspan reiterated that monetary policy would remain low and the FoMC could afford to be "patient" in its implementation. The prospect of continued low rates was both beneficial to equities and bonds but was a reaction to old news, however Thursdays Retail sales data was disappointing and kept the positive tone in place.
|
| |
|
Sarasin's week at a glance - 6 Feb 2004
|
|
Monday, 9 February 2004
|
General Market Analysis
|
The UK's Monetary Policy Committee decided to raise the base rate by 25 basis points to 4% but this had little impact on equity or bond markets as it was already factored in. The reasons cited for this rise were mainly fears of continued over-extension of the consumer even though the new inflationary target had not been breached. It does leave us looking towards the minutes of the meeting, to be released in two weeks, to see if any concerted future movements were implied. Conversely the Swedish Central Bank chose to lower their interest rates by 25 basis points to 2.5%.
Aside from the UK's rate decision global markets will be watching today's US Employment Report and the weekends G7 meeting for direction. The Employment report could have significant effect across both bond and equity markets and currency markets in particular are becoming nervous as any comments from G7 members could significantly move exchange rates.
|
| |
|
Sarasin's week at a glance - 23 Jan 2004
|
|
Monday, 26 January 2004
|
General Market Analysis
|
With little economic data following Mondays holiday in the US, the week had a quiet tone and despite the release of some large corporate results, equity markets remained subdued for the most part. Bond markets fared better and pressed higher over the week in Europe and the US was very much currency led.
The minutes of the UK's Monetary Policy Committee meeting in January were released and showed near unanimous (8 vs 1) support for the base rate to remain unchanged. UK Gross Domestic Product for Q3 2003 was higher than expectations and Retail Sales increased significantly on the month. The main focus point of this data was on the short end of the bond markets, which weakened, as fears for a Base Rate increase at February's MPC meeting increased.
|
| |
|
Sarasin's week at a glance - 16 Jan 2004
|
|
Monday, 19 January 2004
|
General Market Analysis
|
Other than weak Industrial Production and Manufacturing Production figures, most UK economic data was fairly benign and did little to move markets. Equity markets had a flat trading week and bond markets retraced slightly from the highs reached post last Friday’s employment data.
Currencies were certainly the main focus of attention as the US dollar continued to trade in large ranges vs euro and sterling. Dollar/yen continues to rely on significant Bank of Japan intervention to keep the rise of the JPY in check. US economic data was much in line with expectations with the exception of Retail Sales which were weaker than market forecasts giving US Treasury bonds a boost.
|
| |
|
Sarasin's week at a glance - 9 Jan 2004
|
|
Friday, 16 January 2004
|
General Market Analysis
|
The main points of focus for the week were the monetary policy meetings from the UK Monetary Policy committee and the European Central Bank. Both elected to leave rates on hold at 3.75% and 2% respectively. Although no change was expected from either area, both bond and equity markets rose on the back of this confirmation. This capped a very positive week for global bonds and a generally flat week for European equity markets.
The US dollar has continued to come under pressure versus both Sterling and the euro and reached an all time low versus the euro of 1.2813 on 6 Jan 2004. Data has been mixed over the week but US markets are focused on Friday's employment data which may give a better picture of the speed and sustainability of the economic recovery.
|
| |
|
Sarasin's week at a glance - 5 Dec 2003
|
|
Monday, 8 December 2003
|
General Market Analysis
|
Strong ISM manufacturing data set a good tone for Monday's US session and equities pushed higher over the week. The bond market was weaker initially but rose sharply when Friday's employment report disappointed equity markets with a lower than expected increase. UK and European equity markets drifted after a positive start to the week due to weak data and the onset of reduced liquidity into the year end.
The UK's Monetary Policy Committee elected to keep rates on hold at 3.75% following last month's increase. The European Central Bank also kept its rates on hold at 2% with little improvement in economic data.
|
| |
|
Sarasin's week at a glance - 28 Nov 2003
|
|
Monday, 1 December 2003
|
General Market Analysis
|
The markets optimism for a sizeable upward US GDP revision gave global stocks a boost on Monday and, when released on Tuesday, the GDP data didn't disappoint. Equity markets ticked up slightly amid a mass of US data on Wednesday but Thursdays Thanksgiving Holiday significantly reduced liquidity throughout equity markets. Bond markets weakened as the positive US data was released and new supply in both the UK and US was not well received. The Long UK Gilt auction of GBP 2.5bn weighed heavily on the long end and took some time to be digested and it was a similar story with the US 2 year note.
Once again the world saw the threat of terrorism spook markets as several subway workers in New York were treated for exposure to an "unknown substance". This sent equities lower and money was put into Bond markets. Thankfully, the incident was non-terrorist related but the mere threat proved to be market moving in these nervous conditions.
|
| |
|
Sarasin's week at a glance - 21 Nov 2003
|
|
Tuesday, 25 November 2003
|
General Market Analysis
|
The minutes of the Monetary Policy Committee's recent meeting were released and showed an 8 to 1 majority for the 25 basis point base rate rise which was implemented. The important point as far as both bond and equity markets were concerned was that there was no talk of a larger increase which would have been cause for concern in the interest rate cycle. The MPC has simply taken back the 25 basis point pre-emptive move it made in July, and no more. This was good for shorter dated bonds which had already factored in less favourable data and appeared neutral for equities.
Volatile markets in the Far East fed through to Europe and the US but equity markets turned sour as the full extent of the bombings in Istanbul was reported. Later on, the evacuation of White House staff due to a "blip" on a radar screen, later proved to be nothing more than that unsettled global markets. US Housing starts and permit data again showed significant increases adding more fuel to the recovery fire but equity markets moved marginally lower as the threat of terrorism has once again reared its ugly head.
|
| |
|
Sarasin's week at a glance - 14 Nov 2003
|
|
Monday, 17 November 2003
|
General Market Analysis
|
The Bank of England's Quarterly Inflation Report stated that inflation is likely to build gradually. In Governor King's comments he warned against the current excessive household debt levels, reflecting on the impact of monetary policy. This prompted some buoyancy in the bond and equity markets as the comments were seen as cautious but implying no imminent rate rises to follow last weeks 25bp increase.
Corporate results continue to please the UK, US and European equity markets which have continued to edge higher over the week.
The US Treasury's quarterly refunding (a total of USD57bn in 3,5 and 10yr bonds) was the main driver of global bond markets as each auction was well received, however US Producer prices were reported higher than expected, prompting some profit taking.
|
| |
|
Sarasin's week at a glance - 7 Nov 2003
|
|
Monday, 10 November 2003
|
General Market Analysis
|
The Bank of England's Monetary Policy Committee raised rates by 25 basis points on 6 Nov 03 to 3.75%. The move has made it the first leading Central Bank in nearly four years to tighten policy (source: Financial Times). The European Central Bank kept rates on hold at 2.00%.
The US Economy gained jobs for the third month in October. This data confirmed that US economic growth of 7.2% for the third quarter has prompted companies to raise expansionary expenditure after rising productivity and profit gains. The UK and US equity markets have responded positively as a result.
|
| |
|
Sarasin's week at a glance - 31 Oct 2003
|
|
Monday, 3 November 2003
|
General Market Analysis
|
US GDP figures at 7.2% for the third quarter came out above the 6% expectation of the markets.
Equity Markets have been generally strong this week but Bond markets weak.
Western Investors have had concerns over events in Russian markets. Sarsin's GlobalSar and Equisar Family of funds have no direct exposure to Russia.
|
| |
|
Sarasin's week at a glance - 24 Oct 2003
|
|
Tuesday, 28 October 2003
|
General Market Analysis
|
Minutes of the Bank of England's MPC meeting in October, which were released on Wednesday, raised fears of a hike in interest rates before the end of the year. Mortgage banks, housebuilders and industrial stocks were the worst hit as the market priced in a quarter point rate rise in November. Sterling rallied to its highest level in five years on Wednesday against the dollar rising above $1.69.
US Treasury prices have risen, heading for their first weekly gain in four, as investors reduce their equity holdings in order to lock in profits gained from the strong performance of world equity markets over the last six months. The yield on the 10-year US Treasury note fell 8 basis points over the week, having gained nearly 40 basis points since the beginning of the month. European 10-year bonds are set for their second week of gains in three following signs that economic growth in the Eurozone will lag that in the US. The US will release gross domestic product figures for the third quarter on Thursday.
|
| |
|
Sarasin's week at a glance - 17 Oct 2003
|
|
Monday, 20 October 2003
|
General Market Analysis
|
US housing starts rose in September by 3.4 percent, to the second highest figure recorded in the last 17 years (Bloomberg). This provides further evidence of a faster rate of economic growth than posted in the first half of this year. With the US job market also showing signs of revival, as well as rising consumer confidence, speculation of a sustainable rebound in the economy will be increasing. Should this be the case, the equity market could well continue its upward momentum and our balanced fund range, which is approximately 65% exposed to this asset class, will benefit further.
Confirmation that the Chinese economy is still experiencing a rapid rate of growth was received this week, when Central Bankers posted a figure of 9.1% (Financial Times). This easily beat the 6.7% figure reported for the second quarter. Sarasin's Thematic equity process has Sarasin to identify a number of companies driving and benefiting from this growth, which have contributed to the Sarasin EquiSar and Sarasin GlobalSar fund's strong performance year to date.
|
| |
|
Sarasin's week at a glance - 10 Oct 2003
|
|
Monday, 13 October 2003
|
General Market Analysis
|
The FTSE 100 index closed above 4,300 yesterday for only the second time this year. Investors took heart from evidence that the US economy was starting to create jobs - US initial jobless claims fell 23,000 to 382,000, the lowest since February.
The US dollar gained against a number of currencies yesterday making up some of the losses in previous sessions. However, it continues to be under pressure against the Japanese Yen which climbed to a new three year high today. Sarasin is continuing to exploit this weakness within their range of funds by maintaining a high Japanese equity weighting, particularly focusing on those companies with a domestic bias.
The Bank of England's MPC left UK interest rates on hold yesterday at 3.50% despite strong economic data released earlier in the week giving rise to speculation of a rate hike.
|
| |
|
Sarasin's week at a glance - 3 Oct 2003
|
|
Tuesday, 7 October 2003
|
General Market Analysis
|
A turbulent week saw the bulls emerge triumphant helped by a surprise gain in jobs in the US Equity markets had already regained their poise from the recent sell-off caused by the weak US dollar, especially in Japan and Asia.
Conversely bond markets which have been strong over the last few weeks on feelings that this might be a muted recovery have reversed as traders reckon they have been too cautious regarding economic growth.
|
| |
|
Sarasin's week at a glance - 26 Sep 2003
|
|
Monday, 29 September 2003
|
General Market Analysis
|
Gold prices jumped to seven year highs yesterday to peak at USD393.30 a troy ounce. The sharp fall in the US dollar following the G7 call for flexible exchange rates was largely responsible for the gold price strength, however, the rise in oil prices following the OPEC decision to cut output by 900,000 barrels a day from 1 November also contributed. Within the Sarasin Fund range, the funds currently hold over 5% exposure to this commodity which should continue to provide positive returns as the market consensus is that bullion prices will break the USD400 a troy ounce level.
US government bond prices rose yesterday after weak economic data raised concerns about the strength of the recovery. A fall in US manufacturing goods orders overshadowed a larger than expected fall in jobless claims. The uncertain economic outlook began on Monday with the sharp fall in the US dollar which hit a near three year low of JPY110.93 against the Japanese yen on Tuesday. This was exacerbated on Wednesday by fears of the impact of rising oil prices on corporate profits.
|
| |
|
Sarasin's week at a glance - 19 Sep 2003
|
|
Monday, 22 September 2003
|
General Market Analysis
|
Bond markets in the US continued to regain their poise with Treasuries set for their fifth weekly gain as Federal Reserve members said that improvements in the economy have yet to bolster growth and a declining rate of inflation threatens recovery.
These comments, though helping bonds, did not hurt equities as investors continued to bet on a recovery later in the year - Japan, Emerging markets and cyclicals, like mining stocks, remained strong.
|
| |
|
Sarasin's week at a glance - 12 Sep 2003
|
|
Monday, 15 September 2003
|
Fund Manager Comment
|
Growing investor confidence in economic recovery helped to send the FTSE 100 index to its highest level since 27 Aug 2002 on Monday, with sentiment bolstered by positive economic data, upbeat company results and favourable broker comment. However, London's blue chip index proceeded to fall for its third successive day on Thursday as stocks succumbed to profit taking amidst fears that the rally in world stock markets had run too far.
Within the US, economic data published this week confirmed an increase in jobless claims by 2,000 to 422,000. Despite this, US stocks closed higher on Thursday putting an end to a two-day losing streak, as investors snapped up airline, technology and retails shares.
Improved business spending and better prospects for exporters prompted the Japanese government to raise its official reading on the economy for the second straight month Friday, though officials stopped short of saying a full recovery was under way. The upgrade follows a string of data suggesting Japan's economy is picking up after a decade of stagnation.
|
| |
|
Sarasin's week at a glance - 5 Sep 2003
|
|
Monday, 8 September 2003
|
General Market Analysis
|
US monthly non-farm payrolls fell 93,000 in August - the seventh consecutive month of declines. This was in stark contrast to the consensus expected rise of 12,000, suggesting that the recovery in activity may be less buoyant than previously expected.
Gold bounced on the back of the US dollar fall, following the payroll figures, as the commodity's status as a safe haven asset was confirmed. This was despite earlier worries in the week that gold was overvalued. The spot price of gold at midday on Friday reached USD375.00.
During the week, however, the US dollar was supported by the Japanese government buying the currency to prevent an appreciation of the yen. Meanwhile Japanese stocks took a breather from their four-day winning streak as investors took profits. Sarasin funds continue to remain overweight Japanese equities.
|
| |
|
Sarasin's week at a glance - 29 Aug 2003
|
|
Wednesday, 3 September 2003
|
General Market Analysis
|
Yields on 10 year Japanese government bonds reached a high of 1.55% on Wednesday, the highest since Feb 2002, as the equity rally in Japan continues. JGB yields were rapidly approaching zero in the middle of June this year and the reversal in yields over the last two months has been nothing short of dramatic. Investors have piled into stocks in the hope of an economic revival - Q2 GDP numbers were strong and corporate earnings have generally surprised on the upside. Sarasin continue to favour Japan and maintain an overweight position within the Sarasin Funds.
Second quarter GDP figures in the US were revised upwards on Thursday from 2.4% to 3.1%. This helped the US equity market close up on the day despite thin volume. Traders attributed the lacklustre activity due to extended holidays ahead of the three day Labour Day break.
Gold eased a little yesterday on the back of the US GDP announcement as the US dollar strengthened against the euro. However, the commodity bounced back to six month highs on Friday.
|
| |
|
Sarasin's week at a glance - 22 Aug 2003
|
|
Monday, 25 August 2003
|
General Market Analysis
|
US economic numbers continue to show signs of improvement and equity markets have been rising. Treasury markets are generally lower over the week though corporate bond spreads have continued to tighten. Rising yields have made US vs European bonds more attractive and the dollar has strengthened significantly over the period.
Japan and Far East Emerging Markets, where Sarasin funds are significantly overweight, are geared to the US economic pick up and are benefiting as a result.
|
| |
|
Sarasin's week at a glance - 15 Aug 2003
|
|
Monday, 18 August 2003
|
General Market Analysis
|
The US trade deficit unexpectedly fell in June, falling to $39.5bn from $41.5bn, the biggest jump for three years. This gap in goods and services trade narrowed as a result of increased shipments of capital goods, including aircraft and computer parts, due mainly to a cheaper dollar driving demand causing a 2.4% rise in exports. In response to this data, equity markets responded well this week and the performance of the Sarasin CI EquiSar Sterling Global Thematic Fund was particularly pleasing.
The US 10 year Treasury note now yields 4.5%, having yielded as low as 3.07% on 13 Jun 2003. At that time Sarasin reduced the fund's exposure to longer dated bonds, avoiding the worst of the sell off. However, with such a rapid back up in yields, Sarasin are now selectively purchasing longer dated issues within the balanced and income fund ranges, in order to take advantage of the attractive yields presently available.
|
| |
|
Sarasin's week at a glance - 8 Aug 2003
|
|
Monday, 11 August 2003
|
General Market Analysis
|
European corporate financials have, on the whole, continued to post impressive results again this week, the most notable being ABN Amro, Credit Suisse and Barclays. Sarasin continue to favour high quality stocks within this sector that provide attractive dividend yields at a premium to yields on government benchmark treasury stocks.
Japanese machinery orders for June, which were published earlier this week, rose for the second consecutive month. This provides further evidence that the Japanese economy is showing signs of rebounding from its protracted recession, as companies increase the level of investment in anticipation of higher sales. Within the Sarasin range of funds, the fund managers have held an overweight position in Japanese equities, which has proved successful as the Nikkei 225 has risen approximately 9% in US dollar terms from 1 June 2003 to 8 August 2003 .
|
| |
|
Sarasin's week at a glance - 1 Aug 2003
|
|
Monday, 4 August 2003
|
General Market Analysis
|
Once again the US economy provided mixed signals to investment markets this week. Consumer confidence figures showed an alarming drop in June, reversing much of their improvement since the war started in March. On the other hand, GDP growth of 2.4% for Q2 was much stronger than expected. The net effect on investment markets was a further decline in bond prices and a strong performance from equities in the second half of the week.
US 10 year Treasuries now yield 4.51% from a low of 3.1% earlier this year and those moves have been repeated on a much smaller scale in UK and European government bonds. In general, therefore, the move in the second quarter to reduce overall bond exposure, shorten duration and switch some government issues into corporates is still working in Sarasin's favour. Asset allocation across the GlobalSar family of funds is currently around 63% equities, 33% bonds, 4% cash. Within the equity content of portfolios there is a strong focus on Sarasin's new theme "Profiting from Deflation", where the emphasis on dividend yield premium backed by strong free cashflow is still attractive.
|
| |
|
Sarsin House Report - Jun 2003 & new theme
|
|
Wednesday, 30 July 2003
|
General Market Analysis
|
Sarasin say that there has been a really strong quarter in the Global Equity Markets as well as across most of our funds. One other clear feature was a strong outperformance
of mid-cap over larger stocks; with the quarter's winners being led by German equities, technology, tobacco and mid-cap UK equities. Will equity markets continue to rally? Sarasin believe the answer is yes, but not at quite the same pace as the last quarter.
Economic Backdrop
Since the end of the Iraq war, the US economy has enjoyed an uprecedented easing in liquidity conditions. Against this backdrop we clearly see economic activity picking up from the levels of 2003. However, much of this is based on temporary factors including mortgage refinancing and surging government spending. There are also some first signs of economic rebound in the rest of the world.
Even with a modest global recovery, a combination of a move to higher savings in the US and deliberate deleveraging by companies could still, if unchecked, lead to corrosive deflationary forces. To counter this a new stage of Central Bank policy has begun This policy will mean a global economy awash with liquidity with each region trying to re-flate competitively versus its neighbour.
The War on Deflation - Sarasin's new Theme
War on Deflation
While many analysts are still struggling with the implications of the Federal Reserve's 'War on Deflation' for fixed interest markets, we believe that the new policy tack has at least equal implications for equity markets. We expect the Federal Reserve's determination to prevent a Japanese style deflationary spiral to create an unusual divergence between liquidity and economic trends. Monetary conditions will remain ultra-loose but fail to translate into robust economic growth.
The result is that yields on short dated bonds and cash pale in comparison to the cash flow yields of stable and defensive companies. At the same time, sub-normal interest rates are rewarding companies that work capital more aggressively to increase the return on equity. Sarasin believes that the Fed's 'War on Deflation' will become a key factor in delivering superior equity returns. Sarasin therefore propose to introduce it as a new and fifth theme across the thematic equity accounts.
This theme looks at the impact of the structural change in the US monetary policy for global equities. In particular it leads investors to:
1) Global Companies that produce dividend yields higher than government bonds
2) Companies with strong free cash flow and defensive business models
3) High return utilities and basic industries across the Emerging World
5) Defensive businesses using leverage to improve overall equity returns
4) Mid-sized targets of renewed mergers, private equity and leveraged buy out players
|
| |
|
Sarasin's week at a glance - 25 Jul 2003
|
|
Monday, 28 July 2003
|
General Market Analysis
|
US durable goods orders surged to the highest level since January, driven by spending on new equipment (Bloomberg). This provided further evidence that the US economic recovery is progressing, as additional corporate spending proves confidence is returning. This should be supportive to equity prices as long as higher levels of demand justify new capital outlay, which in turn flows through to improved earnings.
The Gold spot price moved higher this week, passing through its two hundred day moving average pricing range. This is significant as gold is a natural hedge against US dollar weakness versus major currencies. Sarasin's current forecast is for further dollar weakness and Sarasin have, with these factors in mind, begun to make acquisitions within the equity portfolios of companies most exposed to this commodity.
|
| |
|
Sarasin's week at a glance - 18 Jul 2003
|
|
Wednesday, 23 July 2003
|
General Market Analysis
|
This month, US consumer confidence rose again for the third month in four, on the back of improved stock market performance, lower interest rates and tax cuts. The University of Michigan's preliminary July sentiment index moved to 90.3 from 89.7 (Source: Bloomberg). Encouraged by this figure and other encouraging recent data, economists have now raised their growth figures for the fourth quarter yet further. The average prediction for fourth quarter US economic growth now stands at an annualised rate of 3.7%.
In Europe, stocks rallied for the first time in four days on Friday morning, spurred on by Ericsson, Siemens and Bayer. Ericsson, the world's largest maker of wireless networks, had gained 27% at one point, as extensive cost cutting allowed the company to beat analysts' expectations. Siemens and Bayer both advanced on the back of a second consecutive week of gains by the dollar, easing concerns that the recent strength in the euro would continue to hurt European exporters' competitiveness.
|
| |
|
Sarasin's week at a glance - 27 Jun 2003
|
|
Monday, 30 June 2003
|
General Market Analysis
|
World equities are heading for their biggest quarterly gains in four and a half years, as we near the end of the period. Fuelled by a fast resolution to the conflict in Iraq, the run up to which had been a significant impediment on market performance, the MSCI World Equity index was up 17% on the quarter up until Thursday. In the fourth quarter of 1998, the index rose 21%.
Advances have been further helped by interest rate cuts in the US and Europe. The European rate now stands at 2%, the lowest since 1948 for the 12 countries that share the euro. In the US, the benchmark rate is now 1%, following a cut of 25 basis points in the FOMC meeting on Wednesday. The latter move once again confirms the US Treasury’s desire to use all means available, both conventional and unconventional, to avoid a deflationary spiral in the world’s biggest economy.
|
| |
|
Sarasin's week at a glance - 13 Jun 2003
|
|
Monday, 23 June 2003
|
General Market Analysis
|
Markets this week have been dominated by economic data and continued speculation, on both sides of the Atlantic, as to how far interest rates will be cut by the Fed next week.
Retail sales data in the UK, published on Thursday, were down 0.1% on the previous month against a forecast rise of 0.2%.
Media reports in the US last week suggested the Federal Reserve would cut interest rates by 50 basis points at their meeting next week. However strong data from the New York Empire State Survey of Manufacturing index, which rose to 26.8 in June, gave the interest rate forecasters pause for thought and the US dollar a brief respite against the euro.
|
| |
|
Sarasin's week at a glance - 13 Jun 2003
|
|
Wednesday, 18 June 2003
|
General Market Analysis
|
The beginning of the week saw the expected confirmation from the Chancellor that it was not the right time for Britain to join the Euro. There was initial weakness in sterling against the euro on the back of the news but this was soon reversed. There was also continued sterling strength versus the dollar thanks in part to the interest rate differential.
The US markets have been dominated this week by management issues at mortgage financing company Freddie Mac and continued expectations of rate cuts in the upcoming Fed meeting - despite good retail sales figures for May. US Treasury yields have fallen as a result and the equity markets have warmed to the prospect of a cut in order to improve the prospects of recovery in the economy.
|
| |
|
Sarasin's week at a glance - 6 Jun 2003
|
|
Monday, 9 June 2003
|
General Market Analysis
|
As expected the MPC left UK rates unchanged yesterday.
UK Markets started strongly this week reaching a six-month high on renewed optimism of a recovering US economy, slipping back mid week following mixed economic data on the home front. Key data during the week showed retail sales rising at their fastest rate for six months and conversely a decline in UK Manufacturing.
As forecast, the ECB cut its benchmark interest rate by half a point to 2%, taking rates on the Continent to their lowest levels since 1948. Despite this action, the Euro continued to strengthen as markets judged the cut would be more beneficial to growth than harmful to yields.
US Markets continued to rise benefiting from increases in corporate earnings helped by further US$ weakness and a report showing unexpected strength across the service sector. Towards the end of the week, however, the initial jobless claims numbers were worse than expected at 442,000.
Japanese and Asian markets continued to rally. In Japan the Topix enjoyed its longest uninterrupted spell of upward momentum for nine years.
|
| |
|
Sarasin's week at a glance - 23 May 2003
|
|
Monday, 26 May 2003
|
General Market Analysis
|
The effect of the euro’s advance against the dollar has been in evidence recently as, among others, Siemens and Pernod Ricard reported the extent of the damage to sales caused by the 27% gain in the Eurozone currency over the last 12 months. The gain has eroded foreign earned profits and reduced the competitiveness of exports. In Pernod’s case, a 10% drop in the dollar results in a GBP22m hit on profit.
Whilst ECB President Wim Duisenberg has said that he remains unconcerned about the strength of the currency, a further strengthening will make a recovery for the Eurozone’s battered economies even tougher. This has hardened the already strongly held belief that interest rates will be further reduced in the near future. This expectation is reflected in the fact that European 10 year bonds are poised for their sixth straight week of gains.
|
| |
|
Sarasin's week at a glance - 16 May 2003
|
|
Monday, 19 May 2003
|
General Market Analysis
|
Speculation that the ECB will shortly cut interest rates has left the Euro poised for its first potential weekly loss since the beginning of April. Prompted by negative first quarter GDP from Germany and Italy, the ECB is expected to close the interest rate differential with the United States in a further attempt to stimulate growth in the ailing economy, thus making the euro less attractive for investors. However consensus still remains for an out-performance over the struggling dollar.
In America, concerns over the threat of deflation were heightened with the news that US consumer prices fell for the first time in more than a year. After recent comments from the Federal Reserve that they would attempt to combat the risk of deflation with both conventional and unconventional means, there still remains a strong chance of a further cut in interest rates from their near 42 year lows. Consequently, expectations of a further injection of liquidity into the system have contributed to strong performances from both equity and fixed income markets over the week.
|
| |
|
Sarasin's week at a glance - 9 May 2003
|
|
Monday, 12 May 2003
|
General Market Analysis
|
Despite continued disappointing German Industrial Production data, which fell by more than twice analysts’ expectations, the ECB kept interest rates on hold on Thursday, as Wim Duisenberg suggested that the current rate of 2.5% was conducive to growth. At the same time, however, he announced that the ECB would now target an inflation rate of "close to two percent", rather than between zero and two percent, thus permitting more flexibility in monetary policy, which could lead to potential benefit to equity investors.
In the UK, the MPC also kept rates on hold at 3.75%, suggesting that growth and inflation would be higher than expected due to the drop in the value of sterling, which now sits at a four year low against the euro. Equity markets reacted badly to the news yesterday, but bounced back on Friday at the expense of bonds, as the Treasury issued a further $58bn of bonds to fund the burgeoning US current account deficit.
|
| |
|
Sarasin's week at a glance - 2 May 2003
|
|
Thursday, 8 May 2003
|
General Market Analysis
|
Unemployment has risen again in the USA, according to figures released on Friday. Six percent of the US population is currently out of work. However, this increase was better than consensus expectations and the leading equity markets rose as a result ending a broadly positive week.
Sarasin currently hold a weighting of approximately 60% in equities within their balanced fund range, which has proven correct after another strong week. Sarasinhave increased the fund's financial weighting to take advantage of attractive insurance and investment banking valuations supported by strong free cash flow and healthy dividend payout policies.
|
| |
|
Sarasin's week at a glance - 25 Apr 2003
|
|
Tuesday, 29 April 2003
|
General Market Analysis
|
Equity markets tailed off at the end of the week due to a combination of weak unemployment data and lower than expected Q1 GDP data in the US. GDP, the sum of all goods and services produced in the US, came in at 1.6% against analysts expectations of 2.4%, as concerns over the situation in Iraq pushed consumer confidence to a nine year low. Since the end of the conflict in Iraq however, the rise in consumer confidence has been the largest since 1992, increasing from 77.6 in March to 86 in April.
In contrast, the fixed income market was headed for its second consecutive week of gains, as concerns continued about the strength of the economic recovery. Analysts continue to expect further interest rate cuts in the short term, which would again benefit Sarasin's fixed interest allocations within the balanced Funds.
|
| |
|
Sarasin's week at a glance - 17 Apr 2003
|
|
Friday, 25 April 2003
|
General Market Analysis
|
European stocks rose on Thursday as Nokia’s results beat analysts’ expectations. The Finnish company was up over 4% as its handset operating margins were up to 24% from 22% from the year before. The stock remains a core holding in Sarasin's "Survival of the Fittest" theme.
Elsewhere, Financial Markets are still focused on the macro economic picture, as investors analyse the potential strength and depth of any economic recovery. In this environment, however, Equity markets saw reasonable gains over the week and fixed income also made ground, spurred by investors’ continued concern about a potential escalation of President Bush’s campaign on terrorism.
|
| |
|
Sarasin's week at a glance - 4 Apr 2003
|
|
Friday, 4 April 2003
|
General Market Analysis
|
Equity markets traded sideways this week, as the primary focus remained on the war in Iraq. Similarly, fixed income was broadly flat, with the exception of corporate issues, where spreads tightened against government stocks on the back of more stable equity markets, as investors sought out yield.
The ECB kept interest rates on hold on Thursday, but comments made at the press conference following the decision raised expectations of a cut next month. The $7 trillion economy is struggling to expand as the war in Iraq prompts consumers and companies to delay or cut spending. European service industries shrank in March, whilst German unemployment once again rose to 10.6%. A cut would signal the lowest rates in the Eurozone since 1948 and would again point to further potential benefit for fixed income markets.
Similarly, the US economy continues to disappoint, as service industries, the largest part of the economy, contracted in March, along with manufacturing, which has been traditionally bolstered in times of war.
|
| |
|
Sarasin's week at a glance - 28 Mar 2003
|
|
Monday, 31 March 2003
|
General Market Analysis
|
As the war in Iraq enters its second week, world markets have been focusing on little else. Equity markets have come back from their recent highs as reports from the Gulf indicate that the war will last longer than initial expectations. The FTSE 100 index has fallen 3.6% since last Friday and the Dow Jones Industrial Average has fallen 3.7% over the same period (source: Bloomberg, figures in local currency). Bond markets were bolstered as a result. Sarasin say they will continue to maintain equity weightings in their GlobalSar Balanced funds at just above neutral to reflect scope for a further valuation-induced rally on favourable news on Iraq.
The UK Consumer Confidence index for March was released today. The index fell to -10, its lowest level since December 1995 (source: Bloomberg). This result was taken before the start of hostilities and next month’s figure will be eagerly anticipated to see what effect the war has on the consumer.
|
| |
|
Sarasin's week at a glance - 21 Mar 2003
|
|
Monday, 24 March 2003
|
General Market Analysis
|
Equity markets continued their strong run this week, as uncertainty over a war with Iraq was finally removed with the start of hostilities. Gains across all indices have been impressive since the lows of last Wednesday. The Dow Jones Industrial index, for example, has been up on seven successive days of trading - the first time since August 2000. Further encouragement can be gained from the fact that the Nasdaq Technology index has recently moved above its 200 day moving average, which has traditionally presaged further upside for the index.
As money moved into equities, bond markets retreated, giving back some of the gains made so far this year. However, after more disappointing data from France and Germany, the news that the ECB is prepared to lower interest rates still further, in an attempt to shore up its economy, should provide renewed support for bonds.
|
| |
|
Sarasin's week at a glance - 14 Mar 2003
|
|
Monday, 17 March 2003
|
General Market Analysis
|
Equity markets staged a dramatic recovery at the end of this week, after some Indices moved to 9 year lows on Wednesday. The FTSE 100 was up 6.1%, its largest move in 15 years, as investors viewed equities as being oversold.
In Europe, the Stoxx 50 had climbed 9.3% in early trading on Friday, compared to a loss of 6.3% by the close on Wednesday. This rise was further supported by an announcement from Gerhard Schroeder that Germany would be easing firing laws, cutting jobless benefits and allotting €15bn for building projects, in an attempt to help stimulate the ailing economy.
In contrast, UK Gilts and US Treasuries dipped heavily, after strong gains so far this year, as investors moved money away from the relative safe haven of fixed income into the equity market. However, expectations remain for further interest rate cuts in the near future, which should provide scope for further capital appreciation in bond markets.
|
| |
|
Sarasin's week at a glance - 7 Mar 2003
|
|
Monday, 10 March 2003
|
General Market Analysis
|
The ECB cut interest rates to the lowest level in three and a half years on Thursday, amid rising unemployment, faltering consumer confidence and waning export demand. The cut, however, was below market expectations. Finance Ministers of the EU member states highlighted the potential for further cuts in the near future, acknowledging that continental European growth may contract this year.
Equity markets reacted indifferently to the news, as continuing concerns over the situation in Iraq dominated investor confidence. In contrast, Treasury markets continued their strong run, with the yield on five year US note at 48 year lows. The dollar also moved to four year lows against the euro, on the back of the ECB cut and the highest initial jobless claims figure for 15 months.
|
| |
|
Sarasin's week at a glance - 28 Feb 2003
|
|
Monday, 3 March 2003
|
General Market Analysis
|
Further speculation on another European interest rate cut at the next ECB meeting was heightened this week, as three of the Central Bank’s members voiced concern over economic growth in the region and at the same time highlighted the tameness of inflation. Initial expectations on the rate move came from ECB President, Wim Duisenberg, who reported last week that he had abandoned his forecast for an economic rebound this year. A cut would be beneficial for the fixed income allocation in our balanced funds.
On a positive note, US GDP was seen to grow at twice the initial reported rate in the fourth quarter of last year, as inventories, consumer and business spending were all stronger than previously reported. The news should help to provide succour for US consumer confidence, which has been battered of late, due to a combination of disappointing economic data and geopolitical tension over the Middle East.
|
| |
|
Sarasin's week at a glance - 21 Feb 2003
|
|
Monday, 24 February 2003
|
General Market Analysis
|
Federal Reserve chairman, Alan Greenspan, found himself at odds with President Bush this week, after comments to the Senate, Banking and House Financial Services committees seem to have undermined Bush's proposed $690bn tax cut. Greenspan argued that the projected deficit of $307bn, (compared to a surplus of $237bn in 2000), was of major concern and that the tax cuts would simply worsen the situation. The Bush administration has made the tax package the centrepiece of its efforts to reignite the economy.
As ever, geopolitical tension continued to dominate financial markets this week, with bonds continuing their strong run. US Treasuries rose for a fifth day on speculation that war in Iraq is moving closer, as investors continued to flock to the relatively safe haven of fixed income. Ten year notes are now up 4% since the UN weapons inspectors were re-admitted to Iraq. In contrast, the S&P 500 is down 11% over the same period.
Bucking the downward trend, equity markets were broadly flat over the week, driven by low volume - there are currently c.1bn bargains a day in the US, compared to the historic average of c.1.4bn.
|
| |
|
Sarasin's week at a glance - 14 Feb 2003
|
|
Monday, 17 February 2003
|
General Market Analysis
|
The US economic picture continued to remain cloudy this week, with the lowest consumer confidence figures in over nine years and stronger than expected industrial production, employment and business inventory figures. The latter led to a sell off in Treasuries, on the suggestion that economic growth was strengthening. Over the week however, bonds continued their strong run.
Equity markets traded sideways over the week, with a raft of corporate figures, which largely hit or exceeded (albeit lowered) expectations. Gains were however tempered by continued concerns of retaliatory attacks on the US if the invasion of Iraq goes ahead as expected. Further clarification on the Iraqi situation will be gleaned from the report by Hans Blix to the UN Security Council this afternoon.
|
| |
|
Sarasin's week at a glance - 7 Feb 2003
|
|
Monday, 10 February 2003
|
General Market Analysis
|
The Bank of England surprised the financial markets yesterday with a 25bp cut in interest rates, citing an "abrupt" deterioration in the economic outlook since the last MPC meeting a month ago. This move brings base rates down to their lowest level since 1955. The UK equity markets recoiled at the news, considering the cut as confirmation that the UK economy has weakened significantly. In contrast, the bond market rallied substantially, with two year yields hitting a record low of 3.35%.
Bond markets across the Eurozone followed suit, even though the ECB maintained rates at 2.75%, in the process ignoring the continued strength of the euro and further woeful German economic data. Investors clearly believe that the ECB will have to yield to substantial pressure at their next meeting.
|
| |
|
Sarasin's week at a glance - 31 Jan 2003
|
|
Monday, 3 February 2003
|
General Market Analysis
|
The combination of the seeming inevitability of war in Iraq, prompted by George Bush's hawkish State of the Union address, and AOL Time Warner posting the largest loss in US corporate history, saw equity markets poised for their third consecutive week of declines. Year to date, the S&P is off 4%, while the FTSE 100 index is now down 9.92%. Fixed Income markets were broadly flat over the week, after a sustained period of substantial gains.
On a more positive note, a government report has shown that US business spending increased in the fourth quarter last year, for the first time in two years. The news provided some relief to the ailing US dollar, which looks likely to post its first weekly gain since the end of November.
|
| |
|
Sarasin's week at a glance - 24 Jan 2003
|
|
Tuesday, 28 January 2003
|
General Market Analysis
|
The dollar fell for a record ninth straight day against the euro on Friday amid heightened concerns that the US is preparing to attack Iraq. As well as bearing the highest costs in the war, the US is expected to see a drop in foreign demand for assets and an increase in the potential for terrorist reprisals. Currently America requires an inflow of $1.4bn a day in order to balance its current account, the broadest measure of international trade.
In contrast, the US bond market has had its second successive positive week, as buyers flocked to the market ahead of the report on Monday by Hans Blix, head of the UN's inspection team. Since January 9th, ten year notes have returned 2.5%, compared to a fall of 6% on the S&P 500 equity index.
|
| |
|
Sarasin's week at a glance - 17 Jan 2003
|
|
Monday, 20 January 2003
|
General Market Analysis
|
Microsoft shifted its strategy on Thursday and decided to pay a dividend of 16c a share, a result of President Bush's $670bn incentive package, (particularly the removal of the federal tax on dividends), to reflate the economy. With Microsoft being the second largest company in the world, this move may set a precedent for other US companies to follow.
UN weapons inspectors uncovered the first evidence of chemical weapons on Thursday, which was seen as increasing the likelihood of war. Equity markets were down on the news, although the removal of further uncertainty over the situation in Iraq may be of benefit in the longer run - on average the Dow Jones has increased in value by 9.1% during the 126 days after the beginning of every major crisis since 1914.
|
| |
|
Sarasin's week at a glance - 20 Dec 2002
|
|
Monday, 6 January 2003
|
General Market Analysis
|
Equity markets were weak again this week, as hopes of an end-of-year rally evaporated. There was also increased speculation that war in Iraq was imminent. The US has announced that it is doubling its number of troops in the Middle East, after denouncing the Iraqi dossier on its chemical and nuclear weapons.
The US dollar weakened in light of this news, together with ongoing concerns on the trade deficit and continued worries about the speed of the economic recovery. In contrast, gold rose to a five and a half year high, as investors moved into the traditionally "safer" areas of the market. Similarly, bond markets were also firmer, which again will benefit Sarasin's Balanced Funds.
|
| |
|
Sarasin's week at a glance - 2 Jan 2003
|
|
Monday, 6 January 2003
|
General Market Analysis
|
President Bush started the New Year with further indications of his intention to help re-inflate the economy, with $300bn of tax cuts and investment incentives planned for the next ten years. One of the most significant changes to be touted is the removal of the double taxation on dividends. Equity markets rallied significantly on the expected implementation of these policies.
Elsewhere in the US, the picture remains fragmented, with the highest monthly rise in the ISM Manufacturing Index in over a decade, contrasting with a disappointing increase in the initial jobless claims last week. Furthermore, concerns about job security and the prospect of war with Iraq are expected to have resulted in the weakest US retail sales in 30 years over the Christmas shopping season.
In the UK, BOE Governor, Sir Eddie George, has indicated that rates are likely to remain on hold in the face of weakening consumer spending and a potential drop in house prices.
|
| |
|
Sarasin's week at a glance - 13 Dec 2002
|
|
Tuesday, 17 December 2002
|
General Market Analysis
|
Political concerns dominated equity markets this week, as fears continued over the potential war in Iraq. The US casus belli was given further impetus with the news that Al Qaeda may have sourced a chemical weapon from Iraq. Additionally, the markets were also held back by the news that North Korea was regenerating its nuclear power program.
However the bond market staged a small rally, which benefited our GlobalSar fund range, which currently has a fixed income allocation of 40%.
In the UK, Cable & Wireless again disappointed earlier in the week, with the news that Moodys had cut their debt to junk status - this had previously been earmarked to be returned to investors or used to fund existing operations. 70% of net cash has now been set aside for potential tax expenses running back to 1996. Year to date, the stock is down 86%. Following comments from Eddie George over previous weeks, the rampant housing market continued to cause concerns, as the UK was placed on credit watch by Moodys.
In contrast, economic figures were more encouraging, with gains in US inventories and sales and the Michigan Consumer Confidence figures.
|
| |
|
Sarasin's week at a glance - 6 Dec 2002
|
|
Monday, 9 December 2002
|
General Market Analysis
|
The ECB finally bowed to intense pressure on Thursday and reduced interest rates by 50 basis points to 2.75%, its lowest level for 3 years. The cuts came after a plethora of bad economic news from the Eurozone, including a rise in unemployment and a decline in business and consumer sentiment. Predictions for Q1 2003 now range from a contraction of 0.2% to an expansion of 0.5%. Qualifying the decision, ECB President, Wim Duisenberg, said that inflationary pressures had subsided and that "downside risks have not vanished".
The equity markets initially reacted well to the news, but were down again on Friday on the back of some disappointing employment data from the US. Corporate bonds were also seen to sell off on indications that the ECB were not planning to cut rates again in the imminent future. In the UK meanwhile, rates remained on hold.
|
| |
|
Sarasin's week at a glance - 22 Nov 2002
|
|
Wednesday, 4 December 2002
|
General Market Analysis
|
Equity markets continued to make positive progress this week, with better news on both the corporate and economic front. Hewlett Packard continued the trend set by Vodafone with stronger than expected results, which fed through to robust market gains. On the macro front in the US, better figures for jobless claims, leading indicators, consumer confidence and productivity all provided further fuel to the equity rally, which was predominantly led by TMT and financial stocks.
On the back of this encouraging data, Sarasin have raised the portfolio equity allocation within GlobalSar to c.60%, from c.57.5%. Sarasin continue to believe that focused stock selection within the equity content will result in strong outperformance. In Fixed Income, Sarasin's focus remains on corporate credit with strong balance sheets. This strategy has already gained from a tightening of corporate spreads over government bond yields in the last few weeks.
|
| |
|
Sarasin's week at a glance - 29 Nov 2002
|
|
Wednesday, 4 December 2002
|
General Market Analysis
|
US Consumer confidence rose in November for the first time in six months according to data published by the University of Michigan on Wednesday (Bloomberg). This combined with stronger than expected GDP growth for the third quarter has confirmed that economic recovery in the US is firmly on track. Equity indexes have reacted favourably across most major world markets as a result and with the prospect of improving economic data Sarasin have increased the portfolios equity weightings to 60% across their balanced fund range.
At the beginning of the week Gordon Brown, the UK Chancellor of the Exchequer announced his pre-budget statement. Within this speech he poured credence on central bankers that have helped the U.K. stave off the recessionary pressures witnessed in North America. However, high levels of public expenditure and falling tax revenues have caused a widening budget deficit, which will be funded by borrowing. Sarasin believe this combined with the prospect of a reversal in housing price growth, may contribute to cause Sterling to weaken against major world currencies.
|
| |
|
Sarasin - Global Energy Theme - Nov 02
|
|
Tuesday, 19 November 2002
|
General Market Analysis
|
A longer look at OPEC beckons caution on Energy
Sarasin defines a theme as a 'Dynamic global trend, which stimulates corporate earnings growth, and drives long term stock price out performance over a multi year period'. The Global Energy Theme's principal multi year driver is the existence of OPEC and its ability to control the supply of crude oil leading to leaner inventories and ultimately a higher than normalised price of oil. OPEC has succeeded in maintaining a higher oil price over the last three years. So far Sarasin's Global Energy Theme has fulfilled their expectations.
OPEC's ability to continue to manage the supply of crude oil is now becoming less certain. Iraq has the second largest reserve base in the world after Saudi Arabia but its infrastructure and productive capacity has been starved of capital for the last decade. US military action beckons and with it the installation of a new Iraqi administration. In the aftermath, conversion of Iraq's reserves into production could result in pressure on other OPEC members to cut production thus weakening the confidence the market has in OPEC. Russia too, is an increasing threat to OPEC both in production terms and because there is no political need for the Russians to maintain a high oil price. Also, lower economic growth suggests the demand outlook for oil is poor.
European stock indices show extraordinary high weightings for energy. Active investors should find it increasingly difficult to justify European energy weightings above these levels. Current energy fundamentals are very good, OPEC having achieved much but the risks of OPEC and Saudi Arabia remaining the dominant price makers is under threat.
Sarasin feel it is early to exit the theme but that they shall continue to hold a few energy stocks that remain attractive within the other themes.
Meanwhile Sarasin's new theme "Survival of the Fittest" is continuing to exceed their expectations. In anticipation of Sarasin's exit from the Global Energy theme the fund manager's have been increasing the funds weighting of Sarasin's recently introduced 'Survival of the Fittest' theme, which is already proving to be successful. Sarasin believes that the current environment is a favourable one for thematic investing, and by acting independently from indexorientated managers Sarasin can produce superior returns over time.
|
| |
|
Sarasin's week at a glance - 15 Nov 2002
|
|
Monday, 18 November 2002
|
General Market Analysis
|
The UK equity market continued to look more poised, remaining above 4000. Better than expected results from Vodafone provided the market with an encouraging catalyst at the beginning of the week, while Cable and Wireless continued to demonstrate the tougher side of the TMT market.
The US continued in a similar vein, with some strong stock gains tempered by continued fears over Iraq, even though Iraq has unconditionally accepted the UN weapons inspection resolution. Better than expected consumer confidence and retail figures were also seen to provide further succour to the markets, outweighing industrial production and inflation data.
|
| |
|
Sarasin's week at a glance - 1 Nov 2002
|
|
Monday, 4 November 2002
|
General Market Analysis
|
In the US, the worst consumer confidence figures in nine years rocked equity markets on Tuesday. Expectations had been for a mild reduction in the figure from the previous month. In reality, the index dropped over 13 points, reflecting a potential turnaround in the US consumer. Whilst the markets initially sold off heavily, they had recovered their equilibrium by the end of day, on the back of heightened speculation of interest rate cuts at the FOMC meeting on Tuesday.
Similarly, in the UK, a drop in consumer confidence and rumours that the housing market is running out of steam have increased pressure on the MPC to cut rates at their next meeting. A subsidence in fears over conflict in Iraq and a quietening down of scandals in the corporate market, have however seen a decrease in volatility and allowed the major markets to level out somewhat.
|
| |
|
Sarasin's week at a glance - 25 Oct 2002
|
|
Monday, 28 October 2002
|
General Market Analysis
|
Volatility in global equity markets was seen to decrease this week, as investors allowed themselves time to digest the sharp advances of the previous weeks. Similarly, the bond markets were seen to stabilise after a period of relative weakness. Stock and economic news continued to be mixed. AOL was up 7.5% on the news that its traditional media businesses had issued stronger than expected figures, but in an omen for the new economy, the Internet service revenues remained muted.
Overall, Q3 earnings numbers have been better than expected, although guidance has been down in many cases. There is a danger that expectations are still too high and it remains important to focus on cash flow, visibility of earnings and strong balance sheets.
In the UK, the market remained steady in the face of mixed news. Aviva's profits were well received, whilst in contrast, My Travel admitted that they would have to restate previous profits by £15-20m and Stagecoach announced that they are to sell large portions of Coach USA, its ill fated US subsidiary, after its 4th profit warning in three years.
|
| |
|
Sarasin's week at a glance - 18 Oct 2002
|
|
Monday, 21 October 2002
|
General Market Analysis
|
World equity markets have been stronger this week as the US corporate earnings reporting season has surprised on the upside. Over 60% of those companies that have reported third quarter results so far have beaten analysts consensus estimates, most notably some high profile 'bellwethers' such as General Electric and Microsoft. Sarasin have increased the equity exposure to over 50% in the balanced fund range, which has been prudent in order to take advantage of the stronger equity market performance.
Corporate bond spreads, the yield 'pick up' currently available over the respective Government equivalent, have widened considerably over the past month. Sarasin believe that this asset class offers attractive value in selected areas and Sarasin may look toward increasing the funds exposure should this technical trend continue, within their balanced and income fund range.
|
| |
|
Sarasin's week at a glance - 2 Oct 2002
|
|
Monday, 7 October 2002
|
General Market Analysis
|
The US Unemployment Rate for September published 4 Oct 2002 was the lowest since February and suggests that the US economic recovery is at this point in time progressing (Bloomberg). As a result the Federal Reserve may decide to leave borrowing costs unchanged in the short term. However, this may be imprudent as payrolls actually fell over the corresponding period prompting concern from some market commentators that interest rates will have to be lowered in order to stimulate further business activity.
The Japanese equity market has fallen to a 20 year low this week, amid concerns surrounding bad loans and the overall weak Japanese economy. Most of this weakness arose from overseas selling as confusion builds as to the direction of economic policy within Japan. Economists expect a further deterioration in the Japanese economy over the short term, as any possibility of growth will evaporate should export sales weaken, a function of slower worldwide demand (Financial Times). Sarasin's Thematic investment process allows us to have an underweight equity exposure to this region, although they do see selective attractive valuations where companies exhibit strong restructuring characteristics.
|
| |
|
Sarasin's week at a glance - 27 Sep 2002
|
|
Monday, 30 September 2002
|
General Market Analysis
|
The US economy grew at a 1.3% annualised rate in the second quarter, faster than previously expected (Bloomberg). This was largely due to an increase in business investment and consumer spending, providing evidence that an economic recovery continues, albeit at a slower rate than previously anticipated. As a result, equity markets have responded positively, having lost ground recently due to concerns about the possibility of war with Iraq and global deflation. Sarasin continue to favour those companies with strong balance sheets and that are now providing attractive yields supported by high levels of dividend cover.
The UK economy also saw faster second quarter growth than previously anticipated due to robust consumer activity. Sarasin remain positive that the UK economy will be less affected by the worldwide economic recession than others and believe that sterling should perform strongly.
|
| |
|
Sarasin - Inoculating Portfolios Against Deflation
|
|
Monday, 30 September 2002
|
General Market Analysis
|
Many in the economics establishment today find it hard to acknowledge the growing evidence of deflation. Unfortunatley the growing deflationary evidence of the last few months is becoming compelling. A year ago most G7 members were shownig inflation rates in the order of 3% pa, today four members have inflation at 1.6% or less. Headline prices are falling in Hong Kong, China and Singapore whilst Taiwan and Thailand are effectively showing a zero rate.
Deflation is not a wholly new phenomenon but there is evidence of it spreading. Every major exonomy in the industrialised world is seeing producer prices factory gate prices) falling on an annualised basis except in the UK where the rate is zero.
Could the UK price indices follow Asia into negative territory? Quite possibly if central bankers fail to insure against it. Rising inflation can be conteracted by lifting interest rates, but the Bank of England cannot reduce interest rates to below zero to lift the UK price indices. If UK house prices started to 'roll over', bringing rents down further and consumer confidence at the same time, this would probably push UK inflation down to or close to zero. Other deflationary forces are at work - the growing supply of goods exported from the emerging world at lower unit costs and the growing ability of the Internet and e-commerce to expose pricing differentials.
How should investors react? Investors should try and lock in part of their income requirements through bond markets at least insure to against deflation. High quality corporate bonds still offer opportunities here. Certain equities should do well. Companies that have pricing power or which can cut costs faster than their competitors could make huge market share gains. Sarasin favour companies with very strong balance sheets, sustainable margins and a committment to automation and efficiency. The message from Japan is clear. Where deflation becomes inbedded, nominal bond yields can theoretically fall to zero. If deflation is to take hold, the risk of remaining in cash as we have seen in Japan, Switzerland and the US is that interest rates can fall rapidly towards zero. Unless investors move decisively they will, like many Japanese insurance companies, miss the chance to lock in yields at rates, which will meet their requirements going forward.
In summary, Western investors today still have an opportunity to inoculate' portfolios to give at least some protection against the risk of deflation. But as bonds rally and the shares of those selected companies that really can prosper in such an environment continue to outperform time is starting to run out. Buy quality and yield while you can still afford it....
|
| |
|
Sarasin's week at a glance - 20 Sep 2002
|
|
Monday, 23 September 2002
|
General Market Analysis
|
This week The European Central Bank announced that it sees the current level of interest rates within the dozen countries using the euro, as 'appropriate' (Bloomberg). This is a shift from its earlier stance where it has consistently indicated that borrowing costs would at some point in the near future have to be raised to curb inflation. With the Bank of England also announcing it stands ready to cut interest rates, Sarasin believe the outlook continues to be favourable for bond markets and our balanced fund range should benefit from its large weighting to this asset class.
The Bank of Japan has indicated that it is prepared to buy equities in order to try to rescue banks that are holding large amounts of shares, as the key index has now fallen to a nineteen year low (Bloomberg). If this strategy is implemented, the Japanese equity market should be underpinned, as investors regain confidence that government intervention will stem further selling.
|
| |
|
Sarasin's week at a glance - 13 Sep 2002
|
|
Monday, 16 September 2002
|
General Market Analysis
|
Alan Greenspan, The Federal Reserve Chairman, testified before the House Budget Committee on Thursday this week. In his speech, Greenspan alluded to the fact that with an inflating budget deficit, it would be imprudent to change interest rates. Sarasin believe US monetary policy is more likely to be driven by evidence that an economic recovery is firmly on track, rather than budget factors and as a result, Sarasin believe interest rates may well have to be cut in order to further stimulate growth in the short term.
The US President, George Bush addressed the UN Security Council to urge action against Iraq's imposing weapons threat. If conflict does become necessary, equity markets are unlikely to suffer a severe setback, as historically a period of strong performance in financial markets has been witnessed after the outbreak of war.
|
| |
|
Sarasin's week at a glance - 6 Sep 2002
|
|
Monday, 9 September 2002
|
General Market Analysis
|
The Bank of England kept borrowing costs at a 38 year low, when it decided to hold its benchmark lending rate at 4% earlier this week (Bloomberg). This decision was most likely a result of the slow pace of economic growth confirmed for the second quarter and the recent weak manufacturing production figures. With benign inflationary pressures, signs that the housing market is slowing and poor stock market performance this year, Sarasin believe interest rates may be reduced in the fourth quarter. For this reason, bond markets should remain underpinned and therefore Sarasin's 45% weighting to this asset class within their Balanced Fund range is appropriate.
The global oil price has reached an eleven month high, surpassing $28 a barrel on speculation that the US will wage war with Iraq (Bloomberg). This will have benefited Sarasin's equity portfolio, where they currently have an overweight energy weighting.
|
| |
|
Sarasin's week at a glance - 30 August 2002
|
|
Monday, 2 September 2002
|
General Market Analysis
|
Equity markets fell from recent highs this week, as investors took profits following weak economic data and continued uncertainty over Iraq. The FTSE All Share has fallen 5% since last Friday (to 29 Aug 02) and the MSCI World Equity index has dropped 2.81% over the same period.
Sarasin's balanced funds have been taking advantage of this retrenchment in equities, which have seen earnings ratios fall to near five year lows, and Sarasin have increased the equity allocation accordingly. However, whilst Sarasin see interesting opportunities in the equity markets, particularly in the area of high yielding, blue chip corporates, on relatively low PE ratios, they have retained their strict adherence to earnings visibility, low PEG ratios, strong balance sheet and good cash flows.
Further support for the Balanced Funds and the Income Portfolio has come from the bond markets, which have again seen significant rallies in light of the equity sell off.
The spotlight once again fell on Chairman Greenspan and the Federal Reserve in America, as Q2 GDP was seen unaltered at 1.1%, confirming the macro economic recovery is at best, mild. Further concern came from the larger than expected US weekly jobless claims data. As a result, expectations have increased that there will be interest rate cuts by the end of the year.
|
| |
|
Sarasin's week at a glance - 16 August 2002
|
|
Tuesday, 27 August 2002
|
General Market Analysis
|
In the markets, investor confidence seems to be returning, as global equity markets perform strongly this week. Within the US, the August 14th deadline for corporations to confirm their accounting practices are in line with SEC regulations has provided a platform from which analysts will be able to build more realistic forecasts. This should enable investors to feel confident that investments will provide shareholder return on an ongoing basis.
|
| |
|
Sarasin's week at a glance - 23 August 2002
|
|
Tuesday, 27 August 2002
|
General Market Analysis
|
The UK economy grew less than the Government previously reported in the Second quarter of 2002, with Gross Domestic Product rising only 0.6%, having been revised down from 0.9%, due predominantly to a contraction in manufacturing output (Bloomberg). This supports Sarasin's expectation that the Monetary Policy Committee will be unlikely to increase interest rates in the near future. While they have become more positive on companies sensitive to interest rates, most notably those in the financial sector, they have become less supportive of economically sensitive cyclical stocks.
Equity Markets have continued to perform strongly this week, as investors appear to have regained some confidence that accounting related problems post August 14th in the US will become less evident. Sarasin's have become more positive on equities in general recently and have increased the funds weightings to this asset class within the GlobalSar fund range to overweight relative to benchmark.
|
| |
|
Sarasin's week at a glance - 9 Aug 2002
|
|
Monday, 12 August 2002
|
General Market Analysis
|
World equity markets have seen strong buying this week, with the Dow Jones Industrial Average in the US rising over 700 points in three days, a move of over 8% (Bloomberg). Much of this strength has been due to a change in expectations, as some economic analysts seem now to be predicting the Federal Reserve will cut interest rates at their meeting next week, having previously thought that they would leave them unchanged. Sarasin's view has been for quite some time that an interest rate cut is likely, as economic growth is on course to fall short of the 3% targeted by the FED.
The International Monetary Fund has issued a statement that Japanese economic recovery will be short lived unless structural problems in the bank and corporate sectors are urgently and comprehensively addressed (Bloomberg). Sarasin have favoured those companies in this region exhibiting strong signs of an ability to restructure but have become more cautious over the last few months as an export driven recovery will undoubtedly be dampened due to the current weak US dollar trend.
|
| |
|
Sarasin's week at a glance - 26 July 2002
|
|
Thursday, 1 August 2002
|
General Market Analysis
|
US corporate profits have risen in the second quarter of this year, the first increase in five straight declines (Bloomberg). With over 70% of the Standard & Poor's 500 index having now reported for this period, a significant percentage have improved profits. This should underpin equity markets in the absence of further corporate accounting scandals. However, if further cases of malpractice are announced, investors will certainly remain very cautious until 12th August, the date, by which all corporations will be obliged to confirm their accounting practices are in line with regulatory standards.
The UK economy has seen a rise of 0.9% in Gross Domestic Product for the second quarter of 2002 (Bloomberg). The Government announced that from a year ago the economy has expanded 1.5%, some of which is due to an increase in manufacturing activity. Although this is positive news, Sarasin believe The Bank of England will resist the temptation to increase interest rates in the short term, until stronger evidence of an economic recovery is confirmed.
|
| |
|
Sarasin's new theme "Survival of the Fittest"
|
|
Tuesday, 18 June 2002
|
General Market Analysis
|
Sarasin's new theme "Survival of the Fittest", will concentrate on those companies with strong balance sheets or premium credit ratings. The main criteria Sarasin will be selecting companies on, will include those operating in industries where the majority of competitors have been damaged by earlier financial indiscretions and those generating strong cash flow in order to achieve competitive advantage, particularly for businesses requiring high, ongoing levels of capital expenditure or R&D. Companies that exhibit balance sheet strength, allowing them to compete more successfully than their peer group, will continue to be central to Sarasin's stock selection, and Sarasin believes this has become ever more important in today's uncertain economic environment.
|
| |
|
Bank Sarasin and Rabobank form alliance
|
|
Tuesday, 5 March 2002
|
Official Announcement
|
Bank Sarasin is entering into a strategic alliance with Rabobank Group of the Netherlands which will strengthen the Sarasin private banking and investment business in the international arena. All Rabobank international private banking units will be integrated within Bank Sarasin.
|
| |
|
Sarasin's reaction to attacks on America
|
|
Friday, 14 September 2001
|
Official Announcement
|
Sarasin Investment Management Limited has expressed their sympathy for those overtaken by the terrorist attacks on the US on 11 September 2001. Member companies of the Bank Sarasin Group have no physical presence in the US and none of their personnel were involved. The implications of the tragedy have been carefully considered in terms of future investment strategy. Sarasin has taken the decision to follow the industry norm and suspend dealings in funds that have exposure to the US market while prices are unavailable but to re-open dealing at the earliest opportunity.
|
| |
|
Sarasin gears up for SA investor market
|
|
Thursday, 15 March 2001
|
Media Comment
|
Sarasin Investment Management Ltd. has appointed Charles de Lame to spearhead its activities in Southern Africa where he will be promoting expertise and, in particular, the Sarasin range of offshore funds.
The appointment follows some time after the approval by the FSB back in 1999 for the Sarasin offshore funds to be marketed in the Republic. R>
The first two are weekly dealing global balanced funds with a mix of equities, bonds and cash. The third is a daily dealing global multi theme driven equity fund investing mainly in "blue chip" global investment portfolios denominated in both sterling or US Dollars.
The management company is a subsidiary of a 150 years old Swiss Private Bank. The group has £16 billion in funds under management and investment team in London that has worked together for over 10 years.
(Source: Investing Abroad, Autumn 2001)
|
| |
