Investors have jumped into emerging markets for the wrong reasons, according to Hermes Investment Management’s Gary Greenberg, and with the strong possibility of a Federal Reserve rate hike, he predicts it is only a matter of time until they realise they have had their dessert before the main meal.
Franklin Templeton’s investment teams have adopted a defensive, “buckle-up” attitude to counter populist fervour in developed markets, but remain encouraged by the resilience and relative political stability of emerging markets.
The confidence of North American investors diminished by 10% between July and August, and this could be further hit by a Federal Reserve decision to raise rates, suggested Kenneth Froot of State Street Global Exchange.
Prolonged political uncertainty and flaws in the institutional framework have kept eurozone equity premium risk at its highest level since the ‘09 global financial and ‘11 eurozone crises, according to new data by NN Investment Partners.
Speaking at the annual Jackson Hole symposium, Federal Reserve Chair Janet Yellen said the solid performance of the United States labour market and current economic outlook mean the case for an increase in the federal funds rate has ‘strengthened in recent months.’
While bonds have become the new stocks for many investors, ‘Taper Tantrum II’ remains a real threat for asset markets this autumn, warned Bank of America Merrill Lynch ahead of Fed chair Janet Yellen’s Jackson Hole speech today.
Morgan Stanley Investment Management has added the Global Balanced and Global Balanced Defensive funds to its line-up.
European Wealth has announced it will alter its fee structure after its financial planning arm saw disappointing turnover and the overall group reported losses in the first half of the year.
Paddy Power Betfair posted losses in its first set of interim results following its merger, which nudged its shares down by 1.7% to 9780.
There are still opportunities to be found in United Kingdom financials according to Jupiter’s Guy de Blonay, and he favours insurance companies over the big UK banks in the current ‘lower for longer’ scenario.
Persimmon shares climbed by 4.4% to 1872p following the release of its first half numbers, making it the top performer in the FTSE 100 index on Tuesday morning.
The United Kingdom’s dividends lagged behind its G7 industrialised peers in the second quarter as the effects from weaker profits and a flailing post-Brexit pound severely hampered pay-outs.
