Tuesday 24 November 2020
News, Investment Talks, Market News
The Covid-19 pandemic drove an unprecedented collapse in economic activity in H1, which was followed by a desynchronized rebound. The recovery phase has been uneven, with the virus cycle dictating the sequence of it. We believe that the damage to the global economy will last well beyond 2021. Output and personal income losses, the rise of inequality, and the disruption in some sectors will be the legacies of the pandemic. Expecting that a vaccine will cause these to dissipate within a few months is too optimistic.
“Marked by the most severe recession in modern history, 2020 was an unprecedented year. With the global pandemic continuing, we enter 2021 with a mildly positive outlook for the upcoming recovery, but with the assumption that the path to pre-crisis growth levels will be long and uncertain. Against this backdrop, investors should be ready to play rotations in their portfolios, favouring cyclical themes but also keeping a strong focus on quality. ”
Investment Insight Blue Paper December 2020
Responsible investing expands further with green convertible bonds
The US election and Covid-19 vaccines: implications for the economy and markets
The likelihood of a divided US government removes a major potential headwind to the US economy, that is, higher taxes. With multiple Covid-19 vaccines showing promise, the US economy may surprise on the upside in 2021.
Early Christmas gifts to support year-end rally
As we approach year-end, markets can count on two pieces of news to propel some optimism. The first comes from the US, where the Biden victory, without a real Blue Wave, is seen by markets as the best possible outcome. A Republican, or even a 50-50 senate, would make it very hard for the new president to pass any extreme measures in terms of fiscal push, more drastic legislation or tax increases.