Global Markets Roundup
National Bank of Greece | Economic Research Division | January 28, 2020
N A T I O N A L B A N Κ
O F G R E E C E
Risk appetite weakens due to concerns regarding the economic impact of the coronavirus
- In a context of extreme equity positioning following sizeable gains since mid-December, as well as elevated valuations with the MSCI Developed Markets Index P/E at 17.3x (22% above its 15- year average), risk appetite faded sharply in the past 3 trading days. Investor sentiment was hurt due to increasing uncertainty about the impact of the coronavirus and the rising risk that the progressive candidate Bernie Sanders may win in the Iowa Democratic Presidential Caucus (February 3rd).
- Indeed, global equities fell by 1% in the past week and euro area indices were down by more than 2% on Monday. At the same time, US 10-Year Treasury yields cumulatively declined by 21 bp to 1.61% on Monday (the lowest since October). Moreover, Speculative Grade corporate bond spreads widened on both sides of the Atlantic by 15-30 bps on a weekly basis, albeit from very low levels.
- Regarding monetary policy, the ECB kept interest rates unchanged (MRO: 0%, DFR:-0.5%), as expected. The bias to ease interest rates was maintained until robust convergence to the inflation objective is achieved. The QE will continue at a monthly pace of €20bn per month of asset purchases for as long as necessary.
- There were some minor positive changes to the introductory statement regarding the assessment of
(still tilted to the downside) risks to the economic growth outlook, moving from "somewhat less pronounced" three months ago to "less pronounced as some of the uncertainty surrounding international trade is receding". Note that January's PMI revealed a stabilization in activity, albeit at very subdued levels, with the composite PMI at 50.9. Regarding the ECB's view on underlying inflation, it shifted from "a mild increase in line with expectations" to a "moderate increase", probably reflecting the current positive outcomes of core inflation (1.3% yoy as of December, the highest rate since April). Note that January's flash estimate for CPI (January 31st) will be monitored for a better assessment of whether the recent acceleration in core prices is sustained. - The ECB meeting also began its monetary policy strategy review, which is expected to be concluded by end-year. The review will include: i) a detailed analysis of inflation and its subdued performance in recent years, as well as the quantitative formulation of price stability (a symmetrical numerical target of 2% instead of "below, but close to 2%" or a tolerance bank of inflation around 2%); ii) the monetary policy toolkit (interest rates including the potential side effects of low/negative rates, forward guidance, asset purchases, and yield-curve control); iii) It will examine how the economic and monetary analyses through which the ECB assesses the risks to inflation should be updated; and iv) it will review its communication practices probably including votes (by name) on every rate-setting decision.
- The Federal Reserve is likely to remain unchanged on January 29th, with interest rates at 1.5%-1.75%. It is expected to be a broadly uneventful meeting as there are no economic and interest rates forecasts scheduled to be released, while Fed officials have reiterated their intention to keep interest rates at their current levels for the time being as policy is in a "good place". Investor attention remains on the Fed's liquidity provision to the financial system through T-bill purchases ($200bn since September), which is expected to continue until May 2020 in order to alleviate funding pressures in the repo markets.
Ilias TsirigotakisAC
Head of Global
Markets Research
210-3341517 tsirigotakis.hlias@nbg.gr
Panagiotis Bakalis
210-3341545 mpakalis.pan@nbg.gr
Vasiliki Karagianni
210-3341548karagianni.vasiliki@nbg.gr
Table of Contents
Safe-haven Assets Performance
Gold | Yen | CHF | US Government Bond (7-10Y) |
week | 106 | 106 | |||||||||||||||||
104 | 104 | ||||||||||||||||||
theof | 102 | 102 | |||||||||||||||||
Charts | 100 | 100 | |||||||||||||||||
98 | 98 | ||||||||||||||||||
96 | 96 | ||||||||||||||||||
94 | 8-Aug | 23-Jan | 94 | ||||||||||||||||
1-Aug | 15-Aug | 22-Aug29-Aug5-Sep12-Sep19-Sep26-Sep3-Oct10-Oct17-Oct | 24-Oct | 31-Oct | 7-Nov | 14-Nov | 21-Nov | 28-Nov | 5-Dec | 12-Dec | 19-Dec | 26-Dec | 2-Jan | 9-Jan | 16-Jan | 30-Jan | |||
Source: NBG Research, Bloomberg, January 2020 = 100 |
See page 12 for disclosures and analyst certification
Euro Area PMIs
Manufacturing | Services | |||||||||||||||
62 | 62 | |||||||||||||||
60 | 60 | |||||||||||||||
58 | 58 | |||||||||||||||
56 | 56 | |||||||||||||||
54 | 54 | |||||||||||||||
52 | 52 | |||||||||||||||
50 | 50 | |||||||||||||||
48 | 48 | |||||||||||||||
46 | 46 | |||||||||||||||
44 | 44 | |||||||||||||||
42 | 42 | |||||||||||||||
Nov-11 | May-12 | Nov-12 | May-13 | Nov-13 | May-14 | Nov-14 | May-15 | Nov-15 | May-16 | Nov-16 | May-17 | Nov-17 | May-18 | Nov-18 | May-19 | Nov-19 |
Source: NBG Research, Bloomberg
1
NBG Global Markets Roundup | Economics & Markets Section
N A T I O N A L B A N Κ
O F G R E E C E
Euro area PMIs overall remained subdued in January
- Euro area PMIs recorded mixed changes in January, with the downturn in the manufacturing sector easing, while the services PMI deteriorated. Overall, the composite index was unchanged at 50.9 (consensus for a moderate improvement to 51.2), slightly above the expansion/contraction threshold of 50. Manufacturing PMI came out at 47.8, in contractionary territory for a 12th consecutive month, albeit improving compared with November (46.3) and reaching a 9-monthhigh. Moreover, the more forward-lookingindicator of new orders increased by 2.4 pts to 49. Combined with a decline of 1.2 pts for the stock of finished goods component to 47.0, the ratio of new orders to inventory (a leading indicator of the headline index) rose substantially, well above 1, leaving room for optimism that the recent improvement in the headline index could be sustained in the next months. In the services sector, the PMI decreased by 0.6 pts in January, albeit remaining well above the expansion/contraction threshold, at 52.6.
Notably, in both sectors, private corporations' optimism improved,
with respondents' expectations for one year ahead output increasing by 1.9 pts to a 16-month high at the composite level, providing encouragement that a bottoming-out of business confidence could lie ahead. Consumer confidence was stable at -8.1 in January, remaining at a satisfactory level (long- term average of -11.5).
- Regarding performance by country, PMIs in Germany posted a broad-based improvement in January, while the composite PMI modestly deteriorated in France, albeit remaining at a satisfactory level. These readings suggest that PMIs declined moderately in the rest of the euro area on a country- weighted basis (analytical data are due in early-February).In its Eurozone PMI press release, Markit noted that in the rest of the euro area, overall business output stood at a 6½-yearlow, at near-
stagnation levels. In France, the composite PMI was down by 0.5 pts to 51.5 (consensus for an unchanged outcome), due to a decrease in services (-0.7 pts to 51.7). The latter though (as also implied by survey respondents' comments) could, in part, be negatively distorted by strikes during the month, especially in the national railway and thus could prove short-lived. The aforementioned deterioration in services more than offset an improvement in the manufacturing PMI (+0.6 pts to 51). On a similar note, INSEE's (France's official statistics office) composite business climate indicator was down by 0.5 pts, to a still resilient
- in January, versus an average of 100 since 1990.
- German PMIs improved substantially, although the IFO business survey revealed a more cautious tone in January. Specifically, manufacturing PMI, despite remaining deep in contractionary territory, improved significantly, by 1.5 pts to 45.2, overshooting consensus estimates for 44.5. The services PMI was also up, by 1.3 pts to 54.2 (consensus: 53.0). Overall, the composite PMI increased by 0.9 pts to 51.1, above consensus estimates for 50.5. Notably, according to Markit, the new orders component rose above the expansion/contraction threshold of 50 for the first time in seven months (at its highest since October 2018), reflecting mainly an easing drag from external demand. On the other hand, the IFO business survey deteriorated by 0.4 pts to
- (consensus: 97.0), with a decrease in the expectations component (expectations for business conditions in the next six months) by 1.0 pt to 92.9, more than offsetting a modest increase in the assessment of current conditions (by 0.3 pts to 99.1).
Euro area bank credit conditions remain loose, while loan demand from corporations eased
-
The ECB's Bank Lending Survey for Q4:19 suggests that the credit environment in the euro area remains supportive of economic activity, although signs emerged that the subdued economic impetus weighs on firms' appetite for investment. Specifically, following a substantial net easing since Q2:14, euro area banks reported largely stable credit standards (i.e. banks' internal guidelines or loan approval criteria) on loans to corporations (+1%) in Q4:19. The tightening effect from a less favorable risk perception related to the economic outlook more than offset the easing effect from increased pressure from competition. Recall that a positive reading indicates that the fraction of banks tightening standards is greater than those easing. Regarding households, standards were little changed for mortgage loans (+1%) and tightened moderately for consumer credit (+3%) in Q4:19. For Q1:20, euro area banks expect credit standards to remain broadly unchanged for loans to corporations, to modestly tighten for mortgage loans (+3%) and to loosen for consumer credit (-6%). Demand was mixed across loan categories. Regarding corporates, the share of banks reporting an increase in loan demand, minus the share of banks reporting a decline, was -8%in Q4:19, the first negative reading since Q4:13. Importantly, subdued capital spending was a key driver of the reduced firms' appetite for financing. Regarding households, the respective figure for consumer credit (credit cards, overdrafts, auto loans, student loans, etc.) was +10%, mainly on the back of low interest rates and resilient consumer confidence. Finally, mortgage loan demand rose substantially, with the net share of banks reporting an increase to +25%, due to low interest rates and a further improvement in the perception of housing market prospects. Recall that house prices in the euro area rose by 3.8% yoy in Q3:19.
UK business confidence improved sharply in January, on the back of reduced political uncertainty - UK PMIs recorded a broad based sharp increase entering Q1:20. Recall that an improvement was anticipated. Note also that the legislative process regarding the European Union (Withdrawal Agreement) Act is completed, with Brexit to take place on January 31st, removing a source of political uncertainty, at least in the short term. Nevertheless, PMIs exceeded expectations, with the manufacturing PMI up by 2.3 pts to 49.8 (consensus: 48.9) and the more forward-lookingindicator of new orders overperforming (+4.5 pts to 50.9). At the same time, PMI in the services sector rose by 2.9 pts to 52.9 (consensus: 51.1). Overall, the composite PMI increased by 3.1 pts to 52.4 in January, the highest since
September 2018. Respondents' comments focused on reduced political uncertainty and more particularly on hopes for an end to domestic political indecision. Note also that in both sectors, private corporations' optimism improved sharply, with respondents' expectations for one year ahead output reaching its highest since June 2015 according to Markit. Looking forward, business confidence is set to remain sensitive to policy-related developments, particularly regarding the challenging and potentially convoluted negotiations for the future relationship with the EU.
National Bank of Greece | Economic Research Division | Global Markets Analysis
2
NBG Global Markets Roundup | Economics & Markets Section
Equities
- Global equity markets lost ground in the past week, due to the health-scare regarding the coronavirus. Overall, the MSCI ACWI ended the week down by -1%(+1.4% ytd), with developed markets (-0.8%wow) overperforming their emerging market peers (-2.4%wow). In the US, the S&P500 ended the week down by -1.0%,with the Energy sector leading the decline (-4.2%wow) on the back of lower oil prices. Regarding the earnings season, out of the 86 companies that have reported results so far, 69% have exceeded analyst estimates. Consensus EPS expectations for Q4:19 stand at -1.9%yoy from -2.4%yoy in the past week and -2.2%yoy in the previous quarter. Positive earnings surprises recorded by companies in the Technology sector were mainly responsible for the decrease in the overall earnings decline during the week. Specifically, the positive EPS surprise reported by Intel ($1.52 vs. $1.25) was the largest contributor to the decrease in the earnings decline and, as a result, the expected earnings growth rate for the sector improved to 0.0% from -1.8%over this period. On the other side of the Atlantic, the EuroStoxx ended the week down by 0.5% wow, with Banks recording strong losses (-2.7%wow), due to lower yields. The DAX 30 rose by 0.4% wow, with the bulk of the increase occurring on Friday (+1.4%), following better-than-expectedPMI data. However, on Monday, European equities recorded strong losses (EuroStoxx: -2.4%,FTSE100: -2.3%),as worries grew about the economic impact of coronavirus. In China, the CSI 300 fell by 3.6% wow (one month low). Note that Chinese markets will remain closed until February 2nd after the extension of the Lunar New Year holiday.
Fixed Income
- Government bond yields declined sharply in the past week due to increased safe-haven demand. Specifically, US 10-yearyields declined by 14 bps wow to 1.69% and 2-yearyields fell by 6 bps to 1.50%. Similarly, in the UK, the 10-yearGilt fell by 7 bps to 0.56% and in Germany, the 10-yearBund yield fell by 12 bps to -0.34%.In Italy, the 10-yearyield declined by 14 bps wow to 1.23% and by a further 20 bps on Monday to 1.04%, to its lowest level since November, as Italian regional elections in Emilia Romagna reduced the likelihood of an early general election. Specifically, the Democratic Party (PD) candidate gained 51.4% of the vote, Salvini's coalition (Lega) gained 43.7% and the Five Star Movement candidate took 3.4%. Corporate bonds spreads in the High Yield spectrum widened in the past week, as investors were in risk-off mode. Specifically, the USD HY spread rose by 29 bps to 368 bps, while its euro area counterpart rose by 15 bps to 316 bps. In the Investment Grade spectrum, spreads were broadly stable both in the US (101 bps) and in the euro area (92 bps).
FX and Commodities
∙ In foreign exchange markets, the British Pound rose in the past week on the back of stronger-than-expected economic data (PMIs) and reduced market expectations of a central bank rate cut on January 30th compared with one week ago (but considerably up compared with one month ago). Overall, the British Pound rose by 0.3% against the US dollar to $1.308 and by 1.2% wow against the euro to €/0.842. The euro declined by 0.6% against the US Dollar to $1.103, with the bulk of the decline occurring on Friday (-0.3%),following subdued PMI data. The Japanese Yen rose in the past week (+1.4% against the euro to ¥120.49 and +0.8% against the US Dollar to ¥109.28) on the back of increased safe haven demand.
∙ In commodities, oil prices declined sharply in the past week, as worries over the coronavirus raised concerns over China's economic growth in H1:2020 and the resulting impact on oil demand. Overall, Brent ended the week down by -7.9%to $60/barrel (-9.7%ytd) and WTI by -7.6%to $54.1/barrel (-11.4%ytd), both at their lowest level since October. Gold prices rose in the past week (+0.9% to $1572/ounce), benefitting from safe haven demand.
N A T I O N A L B A N Κ | |||||||||||||
O F G R E E C E | |||||||||||||
S&P500 vs EuroStoxx | |||||||||||||
index | S&P500 (left) | EuroStoxx (right) | index | ||||||||||
3350 | 420 | ||||||||||||
3250 | 410 | ||||||||||||
3150 | 400 | ||||||||||||
3050 | 390 | ||||||||||||
2950 | 380 | ||||||||||||
370 | |||||||||||||
2850 | 360 | ||||||||||||
2750 | 350 | ||||||||||||
2650 | 340 | ||||||||||||
2550 | 330 | ||||||||||||
2450 | Apr-19 | May-19 | Jun-19 | Jul-19 | 320 | ||||||||
Jan-19 | Feb-19 | Mar-19 | Aug-19 | Sep-19 | Oct-19 | Nov-19 | Dec-19 | Jan-20 | |||||
Source: NBG Research, Bloomberg | |||||||||||||
Graph 1. |
Graph 2.
Probability of a 25 bps Rate Cut by the Bank of England at the January 30th Meeting
% | Probability | % | ||||||||||||||||
100 | 100 | |||||||||||||||||
90 | 90 | |||||||||||||||||
80 | 80 | |||||||||||||||||
70 | 70 | |||||||||||||||||
60 | 60 | |||||||||||||||||
50 | 50 | |||||||||||||||||
40 | 40 | |||||||||||||||||
30 | 30 | |||||||||||||||||
20 | 20 | |||||||||||||||||
10 | 10 | |||||||||||||||||
0 | 0 | |||||||||||||||||
17-Oct | 24-Oct | 31-Oct | 7-Nov | 14-Nov | 21-Nov | 28-Nov | 5-Dec | 12-Dec | 19-Dec | 26-Dec | 2-Jan | 9-Jan | 16-Jan | 23-Jan | 30-Jan |
Source: NBG Research, Bloomberg
Graph 3.
Quote of the week: "I'm concerned about low rate, because low rate is predicated on low growth, and I would much rather have much higher growth, higher rates... but this is not the situation we have at the moment. We are going to look at the potential side effects of the current circumstances", ECB President, Christine Lagarde, January
23rd, 2020.
National Bank of Greece | Economic Research Division | Global Markets Analysis
3
NBG Global Markets Roundup | NBG 12-Month View & Key Factors for Global Markets
N A T I O N A L B A N Κ
O F G R E E C E
US | Euro Area | Japan | UK | |||
Equity Markets
Government Bonds
- Fiscal loosening will support the economy & companies' earnings
- 2019 EPS growth expectations have stabilized
- Cash-richcorporates will lead to share buybacks and higher dividends (de-
equitization)
- Peaking profit margins
- Protectionism and trade wars
- Neutral/Positive
- Valuations appear rich with term-premium below 0%
- Underlying inflation pressures if Fed seek
makeup strategies
▬ Global search for yield by | |
non-US investors continues | |
▬ | Safe haven demand |
▬ | Fed is expected to cut rates |
in H2:2019 |
- Still high equity risk premium relative to other regions
- Credit conditions gradual turn more favorable
- Small fiscal loosening in
2019
- 2020 EPS estimates may turn pessimistic due to plateuning economic growth
- Political uncertainty (Italy, Brexit) could intensify
- Neutral
- Valuations appear excessive compared
with long-term fundamentals
▬ | Political Risks |
▬ | Fragile growth outlook |
▬ Medium-term inflation | |
expectations remain | |
low | |
▬ ECB QE net purchases | |
▬ ECB QE "stock" effect |
- Still aggressive QE and "yield- curve" targeting by the BoJ
- Upward revisions in corporate earnings
- Signs of policy fatigue regarding structural reforms and fiscal discipline
- Strong appetite for foreign assets
- JPY appreciation in a risk-off scenario could hurt exporters
- Neutral
- Sizeable fiscal deficits
- Restructuring efforts to
be financed by fiscal policy measures
- Safe haven demand
- Extremely dovish central bank
- Yield-targetingof 10- Year JGB at around 0%
- 65% of FTSE100 revenues from abroad
- Undemanding valuations in relative terms
- High UK exposure to the commodities sector assuming the oil rally re- emerges
- Elevated Policy uncertainty to remain due to the outcome of the Brexit negotiating process
- Neutral/Negative
- Elevated Policy uncertainty to remain due to the outcome of the Brexit negotiating process
- Inflation overshooting due to GBP weakness feeds through inflation expectations
- The BoE is expected to increase short-term policy rates assuming WA deal
- Slowing economic growth post-Brexit
Foreign Exchange
Slightly higher yields |
expected |
- Safe-havendemand
- Fed is expected to cut rates in H2:2019
- Mid-2018rally probably out of steam
- Broadly Flat USD against the EUR with upside risks towards $1.15
Higher yields expected | |
| Reduced short-term tail |
risks | |
| Higher core bond yields |
| Current account surplus |
▬ | Sluggish growth |
▬ | Deflation concerns |
▬ | The ECB's monetary |
policy to remain extra | |
loose (Targeted-LTROs, | |
ABSs, Quantitative | |
Easing) | |
| Broadly Flat EUR |
against the USD with | |
upside risks towards | |
$1.15 |
- Stable yields expected
- Safe haven demand
- More balanced economic growth recovery (long- term)
- Inflation is bottoming out ▬ Additional Quantitative
Easing by the Bank of Japan if inflation does not approach 2%
- Slightly higher JPY
- Higher yields expected but with Brexit risk premia working on both directions
- Transitions phase negotiations
- The BoE is expected to
increase short-term policy rates assuming WA deal
- Sizeable Current account deficit
- Elevated Policy uncertainty to remain due to the outcome of the Referendum and the negotiating process
- Higher GBP expected but with Brexit risk premia working on both directions
National Bank of Greece | Economic Research Division | Global Markets Analysis
4
NBG Global Markets Roundup | Economic & Markets Forecasts
N A T I O N A L B A N Κ
O F G R E E C E
Interest Rates & Foreign Exchange Forecasts
10-Yr Gov. Bond Yield (%) | January 24th | 3-month | 6-month | 12-month | Official Rate (%) | January 24th | 3-month | 6-month12-month | ||
Germany | -0,34 | -0,20 | -0,15 | 0,00 | Euro area | 0,00 | 0,00 | 0,00 | 0,00 | |
US | 1,69 | 1,80 | 1,90 | 2,00 | US | 1,75 | 1,75 | 1,75 | 1,50 | |
UK | 0,56 | 0,83 | 0,80 | 0,74 | UK | 0,75 | 0,65 | 0,65 | 0,60 | |
Japan | -0,02 | -0,08 | -0,04 | 0,00 | Japan | -0,10 | -0,10 | -0,10 | -0,10 | |
Currency | January 24th | 3-month | 6-month | 12-month | January 24th | 3-month | 6-month12-month | |||
EUR/USD | 1,10 | 1,13 | 1,13 | 1,15 | USD/JPY | 109 | 109 | 107 | 104 | |
EUR/GBP | 0,84 | 0,84 | 0,85 | 0,85 | GBP/USD | 1,31 | 1,34 | 1,33 | 1,35 | |
EUR/JPY | 120 | 123 | 121 | 120 | ||||||
Forecasts at end of period | ||||||||||
Economic Forecasts
United States | 2018a | Q1:19a | Q2:19a | Q3:19a | Q4:19f | 2019f | Q1:20f | Q2:20f | Q3:20f | Q4:20f | 2020f |
Real GDP Growth (YoY) (1) | 2,9 | 2,7 | 2,3 | 2,1 | 2,2 | 2,4 | 1,9 | 1,9 | 1,8 | 1,8 | 1,9 |
Real GDP Growth (QoQ saar) (2) | - | 3,1 | 2,0 | 2,1 | 1,8 | - | 1,9 | 1,8 | 1,9 | 1,9 | - |
Private Consumption | 3,0 | 1,1 | 4,6 | 3,1 | 1,5 | 2,6 | 2,2 | 1,9 | 2,1 | 2,0 | 2,3 |
Government Consumption | 1,7 | 2,9 | 4,8 | 1,7 | 2,1 | 2,3 | 1,5 | 1,3 | 1,3 | 1,3 | 1,7 |
Investment | 4,6 | 3,2 | -1,4 | -0,8 | 0,7 | 1,4 | 2,1 | 2,9 | 2,9 | 3,0 | 1,5 |
Residential | -1,5 | -1,1 | -2,9 | 4,6 | 5,6 | -1,6 | 3,3 | 2,1 | 1,5 | 1,4 | 2,9 |
Non-residential | 6,4 | 4,4 | -1,0 | -2,3 | -1,2 | 2,2 | 1,8 | 3,1 | 3,2 | 3,3 | 1,0 |
Inventories Contribution | 0,1 | 0,5 | -1,0 | 0,0 | -0,4 | 0,1 | -0,1 | 0,0 | 0,0 | 0,0 | -0,2 |
Net Exports Contribution | -0,4 | 0,8 | -0,8 | -0,2 | 0,8 | -0,2 | -0,2 | -0,3 | -0,3 | -0,3 | -0,1 |
Exports | 3,0 | 4,2 | -5,7 | 0,9 | 0,8 | -0,1 | 1,2 | 1,8 | 1,9 | 1,9 | 0,9 |
Imports | 4,4 | -1,5 | 0,0 | 1,8 | -3,8 | 1,3 | 1,7 | 3,0 | 3,0 | 3,0 | 1,0 |
Inflation (3) | 2,4 | 1,6 | 1,8 | 1,7 | 2,1 | 1,8 | 2,2 | 1,9 | 2,1 | 2,1 | 2,1 |
Euro Area | |||||||||||
2018a | Q1:19a | Q2:19a | Q3:19a | Q4:19f | 2019f | Q1:20f | Q2:20f | Q3:20f | Q4:20f | 2020f | |
Real GDP Growth (YoY) | 1,9 | 1,4 | 1,2 | 1,2 | 1,1 | 1,2 | 0,9 | 1,1 | 1,1 | 1,2 | 1,1 |
Real GDP Growth (QoQ saar) | - | 1,8 | 0,7 | 0,9 | 0,9 | - | 1,1 | 1,2 | 1,3 | 1,3 | - |
Private Consumption | 1,4 | 1,5 | 0,9 | 2,0 | 1,3 | 1,3 | 1,3 | 1,3 | 1,3 | 1,3 | 1,4 |
Government Consumption | 1,1 | 1,7 | 2,0 | 1,6 | 1,3 | 1,6 | 1,4 | 1,4 | 1,4 | 1,4 | 1,4 |
Investment | 2,4 | 1,5 | 24,9 | 1,1 | 0,8 | 6,9 | 1,2 | 1,4 | 1,7 | 1,8 | 2,6 |
Inventories Contribution | 0,0 | -0,9 | -0,1 | -0,4 | -0,3 | -0,4 | -0,1 | 0,0 | 0,0 | 0,0 | -0,1 |
Net Exports Contribution | 0,4 | 1,2 | -4,7 | -0,3 | 0,1 | -0,8 | 0,0 | -0,1 | -0,1 | -0,1 | -0,4 |
Exports | 3,3 | 3,5 | 0,6 | 1,7 | 1,7 | 2,4 | 2,0 | 2,2 | 2,5 | 2,6 | 2,0 |
Imports | 2,7 | 1,1 | 11,8 | 2,6 | 1,7 | 4,5 | 2,2 | 2,5 | 2,8 | 2,9 | 2,9 |
Inflation | 1,8 | 1,4 | 1,4 | 0,9 | 1,0 | 1,2 | 1,4 | 1,2 | 1,3 | 1,3 | 1,3 |
a: Actual, f: Forecasts, 1. Seasonally adjusted YoY growth rate, 2. Seasonally adjusted annualized QoQ growth rate, 3. Year-to-year average % change
National Bank of Greece | Economic Research Division | Global Markets Analysis
5
NBG Global Markets Roundup | Economic News & Events Calendar
N A T I O N A L B A N Κ
O F G R E E C E
Economic Calendar
In the US, attention turns to Q4 GDP (30/1). Recent downward revisions for retail sales in October and November have led to more modest expectations for the growth of private consumption in the quarter (to c. 1.5% qoq saar vs 3.1% in Q3) and consequently of GDP, to 1.8% qoq saar according to the Atlanta Fed Nowcast model (1.2% according to New York Fed's Nowcast), versus consensus for 2.1% a couple of weeks ago. Meanwhile, the Fed is expected to remain on the sidelines in the January 29th meeting, with attention mostly in the press conference for any possible signs regarding officials' future policy intentions
In the euro area, January's flash estimate for CPI (31/1) will also be monitored for a better assessment of whether the recent acceleration in core growth (1.3% yoy in both December and November vs 1.0% on average in the past 3 years), is sustained.
Economic News Calendar for the period: January 21 - February 3, 2020
Fed Funds Rate
% | Fed Funds Rate | % | ||||||||||||
6,50 | Forecasts | 6,50 | ||||||||||||
6,00 | 6,00 | |||||||||||||
5,50 | 5,50 | |||||||||||||
5,00 | 5,00 | |||||||||||||
4,50 | 4,50 | |||||||||||||
4,00 | 4,00 | |||||||||||||
3,50 | 3,50 | |||||||||||||
3,00 | 3,00 | |||||||||||||
2,50 | 2,50 | |||||||||||||
2,00 | 2,00 | |||||||||||||
1,50 | 1,50 | |||||||||||||
1,00 | 1,00 | |||||||||||||
0,50 | 0,50 | |||||||||||||
0,00 | 0,00 | |||||||||||||
Jan-99 | Jan-01 | Jan-03 | Jan-05 | Jan-07 | Jan-09 | Jan-11 | Jan-13 | Jan-15 | Jan-17 | Jan-19 |
Source: NBG Research, Bloomberg
Tuesday 21 | Wednesday 22 | Thursday 23 | |||||||||||||||
UK | S | A | P | US | S | A | P | US | S | A | P | ||||||
ILO Unemployment Rate 3Mths | November | 3.8% | 3.8% | 3.8% | Existing Home Sales (mn) | December | 5.43 | + | 5.54 | 5.35 | Initial Jobless Claims (k) | January 18 | 214 | + | 211 | 205 | |
GERMANY | -13.5 | + | -9.5 | -19.9 | Continuing Claims (k) | January 11 | 1756 | + 1731 | 1768 | ||||||||
ZEW survey current situation | January | JAPAN | |||||||||||||||
ZEW survey expectations | January | 15.0 | + | 26.7 | 10.7 | Exports YoY | December | -4.3% | - | -6.3% | -7.9% | ||||||
JAPAN | Imports YoY | December | -3.2% | - | -4.9% | -15.7% | |||||||||||
Bank of Japan announces its | January 21 | -0.10% | -0.10%-0.10% | EURO AREA | |||||||||||||
intervention rate | ECB announces its intervention | 0.00% | 0.00% | 0.00% | |||||||||||||
January 23 | |||||||||||||||||
rate | |||||||||||||||||
ECB announces its deposit | January 23 | -0.50% | -0.50%-0.50% | ||||||||||||||
facility rate | |||||||||||||||||
Consumer Confidence Indicator | January | -7.8 | - | -8.1 | -8.1 | ||||||||||||
Friday 24 | Monday 27 | ||||||||||||||||
US | S | A | P | EURO AREA | US | S | A | P | |||||||||
Markit US Manufacturing PMI | January | 52.5 | - | 51.7 | 52.4 | Markit Eurozone Manufacturing PMI | January | 46.8 | + | 47.8 | 46.3 | New Home Sales (k) | December | 730 | - | 694 | 697 |
JAPAN | GERMANY | ||||||||||||||||
Core CPI (YoY) - ex. Fresh Food | December | 0.7% | 0.7% | 0.5% | Markit Eurozone Services PMI | January | 52.8 | - | 52.2 | 52.8 | IFO- Business Climate Indicator | January | 97.0 | - | 95.9 | 96.3 | |
Core CPI (YoY) - ex. Fresh Food | December | 0.9% | 0.9% | 0.8% | Markit Eurozone Composite PMI | January | 51.2 | - | 50.9 | 50.9 | IFO-Expectations | January | 94.8 | - | 92.9 | 93.9 | |
and Energy | 0.7% | + 0.8% | 0.5% | IFO- Current Assesment | January | 99.1 | 99.1 | 98.8 | |||||||||
CPI (YoY) | December | ||||||||||||||||
PMI manufacturing | January | .. | 49.3 | 48.4 | |||||||||||||
UK | |||||||||||||||||
Markit UK PMI Manufacturing | January | 48.8 | + | 49.8 | 47.5 | ||||||||||||
SA | |||||||||||||||||
Markit/CIPS UK Services PMI | January | 51.1 | + | 52.9 | 50.0 | ||||||||||||
Tuesday 28 | Wednesday 29 | Thursday 30 | |||||||||||||||
US | S | A | P | US | S | A | P | US | S | A | P | ||||||
Durable goods orders (MoM) | December | 0.4% | .. | -2.1% | Pending home sales (MoM) | December | 0.7% | .. | 1.2% | GDP (QoQ, annualized) | Q4:19 | 2.1% | .. | 2.1% | |||
Durable goods orders ex | December | 0.3% | .. | -0.1% | Pending home sales NSA (YoY) | December | .. | .. | 5.6% | Personal Consumption | Q4:19 | 2.0% | .. | 3.2% | |||
transportation (MoM) | January | 128.0 | .. | 126.5 | Fed announces its intervention rate | January 29 | 1.75% | .. | 1.75% | Initial Jobless Claims (k) | January 25 | 215 | .. | 211 | |||
Consumer Confidence Index | Continuing Claims (k) | January 18 | 1730 | .. | 1731 | ||||||||||||
S&P Case/Shiller house price | November | 2.40% | .. | 2.23% | EURO AREA | December | 5.5% | .. | 5.6% | UK | |||||||
index 20 (YoY) | M3 money supply (YoY) | BoE announces its intervention | January 30 | 0.75% | .. | 0.75% | |||||||||||
rate | |||||||||||||||||
BoE Asset Purchase Target (£bn) | January | 435 | .. | 435 | |||||||||||||
EURO AREA | |||||||||||||||||
Economic confidence indicator | January | 101.8 | .. | 101.5 | |||||||||||||
Business Climate Indicator | January | -0.20 | .. | -0.25 | |||||||||||||
Unemployment Rate | December | 7.5% | .. | 7.5% | |||||||||||||
Friday 31 | Monday 3 | ||||||||||||||||
US | S | A | P | EURO AREA | S | A | P | US | S | A | P | ||||||
Employment Cost Index (QoQ) | Q4:19 | 0.7% | .. | 0.7% | GDP (QoQ) | Q4:19 | 0.2% | .. | 0.2% | Construction spending (MoM) | December | 0.4% | .. | 0.6% | |||
Personal income (MoM) | December | 0.3% | .. | 0.5% | GDP (YoY) | Q4:19 | 1.1% | .. | 1.2% | ISM Manufacturing | January | 48.0 | .. | 47.2 | |||
Personal spending (MoM) | December | 0.3% | .. | 0.4% | CPI (YoY) | January | 1.4% | .. | 1.3% | UK | |||||||
PCE Deflator (YoY) | December | 1.6% | .. | 1.5% | Core CPI (YoY) | January | 1.2% | .. | 1.3% | Nationwide House Px NSA YoY | January | 1.5% | .. | 1.4% | |||
PCE Core Deflator (YoY) | December | 1.6% | .. | 1.6% | CHINA | 50.0 | .. | 50.2 | CHINA | 51.0 | .. | 51.5 | |||||
JAPAN | 1.0% | .. | 4.5% | Manufacturing PMI | January | Caixin PMI Manufacturing | January | ||||||||||
Retail sales (MoM) | December | GERMANY | |||||||||||||||
Retail sales (YoY) | December | -1.8% | .. | -2.1% | Retail sales (MoM) | December | -0.5% | .. | 1.5% | ||||||||
Industrial Production (MoM) | December | 0.7% | .. | -1.0% | Retail sales (YoY) | December | 4.5% | .. | 2.7% | ||||||||
Industrial Production (YoY) | December | -3.6% | .. | -8.2% | |||||||||||||
Construction Orders YoY | December | .. | .. | -1.2% | |||||||||||||
Unemployment rate | December | 2.3% | .. | 2.2% | |||||||||||||
Source: NBG Research, Bloomberg |
S: Bloomberg Consensus Analysts Survey, A: Actual Outcome, P: Previous Outcome
National Bank of Greece | Economic Research Division | Global Markets Analysis
6
NBG Global Markets Roundup | Financial Markets Monitor
Equity Markets (in local currency)
N A T I O N A L B A N Κ
O F G R E E C E
Developed Markets | Current | 1-week | Year-to-Date | 1-Year | 2-year | Emerging Markets | Current | 1-week | Year-to-Date | 1-Year | 2-year | |
Level | change (%) | change (%) | change (%) | change (%) | Level | change (%) | change (%) change (%) change (%) | |||||
US | S&P 500 | 3295 | -1,0 | 2,0 | 24,7 | 16,1 | MSCI Emerging Markets | 62053 | -2,1 | 1,0 | 10,6 | -4,9 |
Japan | NIKKEI 225 | 23827 | -0,9 | 0,7 | 15,8 | -0,5 | MSCI Asia | 921 | -2,4 | 0,8 | 12,4 | -7,1 |
UK | FTSE 100 | 7586 | -1,2 | 0,6 | 11,2 | -0,8 | China | 85 | -4,8 | -0,2 | 12,9 | -14,9 |
Canada | S&P/TSX | 17565 | 0,0 | 2,9 | 15,0 | 7,9 | Korea | 716 | -0,4 | 3,6 | 11,8 | -6,4 |
Hong Kong | Hang Seng | 27950 | -3,8 | -0,9 | 3,1 | -15,2 | MSCI Latin America | 102145 | -0,9 | 2,0 | 8,8 | 10,8 |
Euro area | EuroStoxx | 410 | -0,5 | 1,5 | 18,6 | 2,1 | Brazil | 373351 | -0,1 | 2,0 | 16,4 | 32,0 |
Germany | DAX 30 | 13577 | 0,4 | 2,5 | 22,0 | 1,2 | Mexico | 41691 | -1,5 | 3,9 | 3,0 | -13,0 |
France | CAC 40 | 6024 | -1,3 | 0,8 | 23,7 | 9,6 | MSCI Europe | 6504 | -1,4 | 2,0 | 15,3 | 11,6 |
Italy | FTSE/MIB | 23969 | -0,7 | 2,0 | 22,5 | 1,5 | Russia | 1397 | -2,1 | 2,6 | 24,4 | 32,3 |
Spain | IBEX-35 | 9562 | -1,2 | 0,1 | 4,5 | -9,5 | Turkey | 1586638 | -0,4 | 5,6 | 12,6 | -3,5 |
World Market Sectors (MSCI Indices)
in US Dollar terms | Current | 1-week | Year-to-Date | 1-Year | 2-year | in local currency | Current | 1-week | Year-to-Date | 1-Year | 2-year |
Level | change (%) | change (%) | change (%) | change (%) | Level | change (%) | change (%) | change (%) | change (%) | ||
Energy | 189,0 | -3,3 | -4,0 | -3,5 | -20,6 | Energy | 194,9 | -3,2 | -3,3 | -3,2 | -17,3 |
Materials | 265,9 | -1,6 | -2,3 | 12,9 | -10,4 | Materials | 257,1 | -1,4 | -1,4 | 13,8 | -4,9 |
Industrials | 281,9 | -0,5 | 2,0 | 20,4 | 1,4 | Industrials | 280,4 | -0,4 | 2,6 | 21,0 | 4,8 |
Consumer Discretionary | 279,3 | -1,6 | 0,4 | 17,8 | 7,3 | Consumer Discretionary | 270,7 | -1,6 | 0,8 | 18,2 | 9,7 |
Consumer Staples | 253,8 | -0,4 | 1,1 | 19,3 | 4,0 | Consumer Staples | 255,8 | -0,3 | 1,7 | 19,7 | 8,0 |
Healthcare | 282,0 | -1,5 | 1,0 | 18,9 | 16,3 | Healthcare | 279,6 | -1,4 | 1,4 | 19,0 | 18,9 |
Financials | 124,4 | -1,6 | -1,1 | 12,4 | -8,9 | Financials | 125,5 | -1,4 | -0,4 | 12,9 | -5,0 |
IT | 329,6 | 0,4 | 6,0 | 46,9 | 38,8 | IT | 320,0 | 0,4 | 6,2 | 47,2 | 40,0 |
Telecoms | 79,7 | -1,1 | 2,9 | 22,8 | 10,3 | Telecoms | 83,4 | -1,1 | 3,1 | 23,0 | 14,7 |
Utilities | 158,0 | 2,0 | 5,2 | 21,2 | 26,2 | Utilities | 163,1 | 2,1 | 5,8 | 22,0 | 30,9 |
Bond Markets (%)
10-Year Government | Current | Last week | Year Start | One Year | 10-year | Government Bond Yield | Current | Last week | Year Start | One Year | 10-year |
Bond Yields | Back | average | Spreads (in bps) | Back | average | ||||||
US | 1,69 | 1,82 | 1,92 | 2,72 | 2,38 | US Treasuries 10Y/2Y | 19 | 26 | 35 | 15 | 142 |
Germany | -0,34 | -0,22 | -0,19 | 0,18 | 1,09 | US Treasuries 10Y/5Y | 18 | 20 | 23 | 17 | 75 |
Japan | -0,02 | 0,00 | -0,01 | 0,01 | 0,47 | Bunds 10Y/2Y | 28 | 37 | 42 | 76 | 118 |
UK | 0,56 | 0,63 | 0,82 | 1,27 | 1,96 | Bunds 10Y/5Y | 25 | 30 | 29 | 49 | 74 |
Greece | 1,31 | 1,42 | 1,47 | 4,15 | 9,96 | ||||||
Ireland | -0,07 | 0,06 | 0,12 | 0,92 | 3,43 | Corporate Bond Spreads | Current | Last week | Year Start | One Year | 10-year |
Italy | 1,23 | 1,37 | 1,41 | 2,66 | 3,16 | (in bps) | Back | average | |||
Spain | 0,35 | 0,46 | 0,47 | 1,24 | 2,94 | EM Inv. Grade (IG) | 150 | 144 | 150 | 192 | 212 |
Portugal | 0,38 | 0,50 | 0,44 | 1,65 | 4,71 | EM High yield | 466 | 454 | 494 | 513 | 644 |
US IG | 101 | 99 | 101 | 143 | 150 | ||||||
US Mortgage Market | Current | Last week | Year Start | One Year | 10-year | US High yield | 368 | 339 | 360 | 445 | 498 |
(1. Fixed-rate Mortgage) | Back | average | |||||||||
30-Year FRM1 (%) | 3,9 | 3,9 | 4,0 | 4,8 | 4,2 | Euro area IG | 92 | 93 | 94 | 151 | 140 |
vs 30Yr Treasury (bps) | 174 | 159 | 156 | 172 | 117 | Euro area High Yield | 316 | 301 | 308 | 466 | 484 |
Foreign Exchange & Commodities
Foreign Exchange | Current | 1-week | 1-month | 1-Year | Year-to-Date | Commodities | Current | 1-week | 1-month | 1-YearYear-to-Date | |
change (%) | change (%) | change (%) | change (%) | change (%) | change (%) | change (%) | change (%) | ||||
Euro-based cross rates | |||||||||||
EUR/USD | 1,10 | -0,6 | -0,6 | -2,5 | -1,7 | Agricultural | 347 | -1,1 | 1,1 | -3,2 | -0,3 |
EUR/CHF | 1,07 | -0,2 | -1,5 | -4,9 | -1,3 | Energy | 445 | -6,9 | -10,8 | 2,1 | -10,6 |
EUR/GBP | 0,84 | -1,2 | -1,6 | -2,7 | -0,4 | West Texas Oil ($) | 54 | -7,6 | -11,4 | 2,2 | -11,4 |
EUR/JPY | 120,49 | -1,4 | -0,7 | -2,8 | -1,0 | Crude brent Oil ($) | 60 | -7,9 | -10,4 | -1,5 | -9,7 |
EUR/NOK | 9,98 | 1,0 | 0,8 | 2,8 | 1,3 | Industrial Metals | 1186 | -3,8 | -3,3 | -2,4 | -2,6 |
EUR/SEK | 10,55 | -0,4 | 1,1 | 2,7 | 0,4 | Precious Metals | 1844 | 0,7 | 4,3 | 21,4 | 3,1 |
EUR/AUD | 1,61 | 0,1 | -0,4 | 1,2 | 1,0 | Gold ($) | 1572 | 0,9 | 4,8 | 22,7 | 3,6 |
EUR/CAD | 1,45 | 0,0 | -0,7 | -4,0 | -0,5 | Silver ($) | 18 | 0,5 | 2,0 | 18,3 | 1,5 |
USD-based cross rates | Baltic Dry Index | 557 | -26,1 | -48,9 | -40,7 | -48,9 | |||||
USD/CAD | 1,31 | 0,6 | -0,1 | -1,5 | 1,2 | Baltic Dirty Tanker Index | 1190 | -4,1 | -25,5 | 36,0 | -25,5 |
USD/AUD | 1,47 | 0,7 | 1,4 | 3,9 | 2,8 | ||||||
USD/JPY | 109,28 | -0,8 | -0,1 | -0,3 | 0,6 | ||||||
Source: Bloomberg, as of January 24th, S&P/Goldman Sachs Indices for Agricultural, Energy, Industrial | National Bank of Greece | Economic Research Division | Global Markets Analysis |
& Precious Metals, BofA/ML Indices for Corporate Bond Spreads | |
7
NBG Global Markets Roundup | Chartroom
N A T I O N A L B A N Κ
O F G R E E C E
Global Cross Asset ETFs: Flows as % of AUM
DM Equities | Bonds | |||||||||||||
% | EM Equities | Commodities | % | |||||||||||
70 | 70 | |||||||||||||
65 | 65 | |||||||||||||
60 | 60 | |||||||||||||
55 | 55 | |||||||||||||
50 | 50 | |||||||||||||
45 | 45 | |||||||||||||
40 | 40 | |||||||||||||
35 | 35 | |||||||||||||
30 | 30 | |||||||||||||
25 | 25 | |||||||||||||
20 | 20 | |||||||||||||
15 | 15 | |||||||||||||
10 | 10 | |||||||||||||
5 | 5 | |||||||||||||
0 | 0 | |||||||||||||
-5 | -5 | |||||||||||||
-10 | -10 | |||||||||||||
-15 | Apr-15 | Jul-16 | May-17 | Oct-17 | Mar-18 | -15 | ||||||||
Jan-14 | Jun-14 | Nov-14 | Sep-15 | Feb-16 | Dec-16 | Aug-18 | Jan-19 | Jun-19 | Nov-19 |
Source: Bloomberg, NBG estimates, Cumulative flows since January 2014, AUM stands for Assets Under Management, Data as of January 24th
Equity Market Performance - G4
S&P500 | EuroStoxx | FTSE 100 | Nikkei 225 | ||||||||||
116 | 116 | ||||||||||||
114 | 114 | ||||||||||||
112 | 112 | ||||||||||||
110 | 110 | ||||||||||||
108 | 108 | ||||||||||||
106 | 106 | ||||||||||||
104 | 104 | ||||||||||||
102 | 102 | ||||||||||||
100 | 100 | ||||||||||||
98 | 98 | ||||||||||||
96 | 96 | ||||||||||||
94 | 94 | ||||||||||||
92 | 8-Aug | 19-Sep | 14-Nov | 28-Nov | 9-Jan | 92 | |||||||
25-Jul | 22-Aug | 5-Sep | 3-Oct | 17-Oct | 31-Oct | 12-Dec | 26-Dec | 23-Jan | |||||
Source: Bloomberg - Data as of January 24th | - Rebased @ 100 |
Russell 2000 Value & Growth Index
Value/Growth Relative Performance during the previous 6 months (right) Russell 2000 Value (left)
Russell 2000 Growth (left)
2000 | 6 | ||||||||||||
1900 | 5 | ||||||||||||
1800 | |||||||||||||
1700 | 4 | ||||||||||||
1600 | 3 | ||||||||||||
1500 | 2 | ||||||||||||
1400 | |||||||||||||
1300 | 1 | ||||||||||||
1200 | 0 | ||||||||||||
1100 | -1 | ||||||||||||
1000 | |||||||||||||
900 | -2 | ||||||||||||
800 | 8-Aug | 14-Nov | 28-Nov | 9-Jan | -3 | ||||||||
25-Jul | 22-Aug | 5-Sep | 19-Sep | 3-Oct | 17-Oct | 31-Oct | 12-Dec | 26-Dec | 23-Jan |
Source: Bloomberg, Data as of January 24th
Equity ETFs: Flows as % of AUM
% | US | Emerging Markets | Europe exUK | % | |||||||||||
35 | 35 | ||||||||||||||
30 | 30 | ||||||||||||||
25 | 25 | ||||||||||||||
20 | 20 | ||||||||||||||
15 | 15 | ||||||||||||||
10 | 10 | ||||||||||||||
5 | 5 | ||||||||||||||
0 | 0 | ||||||||||||||
-5 | -5 | ||||||||||||||
-10 | -10 | ||||||||||||||
-15 | Apr-15 | Oct-17 | Mar-18 | -15 | |||||||||||
Jan-14 | Jun-14 | Nov-14 | Sep-15 | Feb-16 | Jul-16 | Dec-16 | May-17 | Aug-18 | Jan-19 | Jun-19 | Nov-19 |
Source: Bloomberg, NBG estimates, Cumulative flows since January 2014, AUM stands for Assets Under Management, Data as of January 24th
Equity Market Performance - BRICs
Brazil | China | Russia | India | ||||||||||
120 | 120 | ||||||||||||
118 | 118 | ||||||||||||
116 | 116 | ||||||||||||
114 | 114 | ||||||||||||
112 | 112 | ||||||||||||
110 | 110 | ||||||||||||
108 | 108 | ||||||||||||
106 | 106 | ||||||||||||
104 | 104 | ||||||||||||
102 | 102 | ||||||||||||
100 | 100 | ||||||||||||
98 | 98 | ||||||||||||
96 | 96 | ||||||||||||
94 | 94 | ||||||||||||
92 | 92 | ||||||||||||
90 | 8-Aug | 19-Sep | 14-Nov | 28-Nov | 12-Dec | 9-Jan | 90 | ||||||
25-Jul | 22-Aug | 5-Sep | 3-Oct | 17-Oct | 31-Oct | 26-Dec | 23-Jan |
Source: Bloomberg - Data as of January 24th - Rebased @ 100
Russell 2000 & Russell 1000 Index
Small Cap/Large Cap Relative Performance during the previous 6 months (right) Russell 2000-Small cap (left)
Russell 1000-Large Cap (left)
1880 | 3 | ||||||||||||
1840 | |||||||||||||
1800 | 2 | ||||||||||||
1760 | |||||||||||||
1720 | 1 | ||||||||||||
1680 | |||||||||||||
1640 | 0 | ||||||||||||
1600 | |||||||||||||
1560 | -1 | ||||||||||||
1520 | |||||||||||||
1480 | -2 | ||||||||||||
1440 | |||||||||||||
1400 | 8-Aug | 19-Sep | 14-Nov | 28-Nov | 9-Jan | -3 | |||||||
25-Jul | 22-Aug | 5-Sep | 3-Oct | 17-Oct | 31-Oct | 12-Dec | 26-Dec | 23-Jan |
Source: Bloomberg, Data as of January 24th
National Bank of Greece | Economic Research Division | Global Markets Analysis
8
NBG Global Markets Roundup | Chartroom
N A T I O N A L B A N Κ
O F G R E E C E
EUR/USD
€/$ | EUR-USD | €/$ | ||||||||||||
1,13 | 1,13 | |||||||||||||
1,12 | 1,12 | |||||||||||||
1,11 | 1,11 | |||||||||||||
1,10 | 1,10 | |||||||||||||
1,09 | Stronger USD | 1,09 | ||||||||||||
1,08 | 8-Aug | 22-Aug | 5-Sep | 19-Sep | 3-Oct | 14-Nov | 28-Nov | 12-Dec | 26-Dec | 9-Jan | 23-Jan | 1,08 | ||
25-Jul | 17-Oct | 31-Oct | ||||||||||||
Source: Bloomberg, Data as of January 24th | ||||||||||||||
10- Year Government Bond Yields | ||||||||||||||
% | US (LA) | UK (LA) | Japan (RA) | Germany (RA) % | ||||||||||
2,6 | 0,1 | |||||||||||||
2,4 | 0,0 | |||||||||||||
2,2 | ||||||||||||||
2,0 | -0,1 | |||||||||||||
1,8 | -0,2 | |||||||||||||
1,6 | ||||||||||||||
1,4 | -0,3 | |||||||||||||
1,2 | -0,4 | |||||||||||||
1,0 | -0,5 | |||||||||||||
0,8 | ||||||||||||||
0,6 | -0,6 | |||||||||||||
0,4 | -0,7 | |||||||||||||
0,2 | ||||||||||||||
0,0 | 8-Aug | 22-Aug | 5-Sep | 19-Sep | 3-Oct | 14-Nov | 28-Nov | 12-Dec | 26-Dec | 9-Jan | 23-Jan | -0,8 | ||
25-Jul | 17-Oct | 31-Oct | ||||||||||||
Source: Bloomberg - Data as of January 24th | ||||||||||||||
LA:Left Axis RA:Right Axis | ||||||||||||||
West Texas Intermediate ($/brl) | ||||||||||||||
$/brl | WTI | $/brl | ||||||||||||
64 | 64 | |||||||||||||
62 | 62 | |||||||||||||
60 | 60 | |||||||||||||
58 | 58 | |||||||||||||
56 | 56 | |||||||||||||
54 | 54 | |||||||||||||
52 | 52 | |||||||||||||
50 | 8-Aug | 19-Sep | 14-Nov | 28-Nov | 9-Jan | 50 | ||||||||
25-Jul | 22-Aug | 5-Sep | 3-Oct | 17-Oct | 31-Oct | 12-Dec | 26-Dec | 23-Jan |
Source: Bloomberg, Data as of January 24th
JPY/USD
$/¥ | USD-JPY | $/¥ | |||||||||||
111 | 111 | ||||||||||||
110 | 110 | ||||||||||||
109 | 109 | ||||||||||||
108 | 108 | ||||||||||||
107 | 107 | ||||||||||||
106 | Stronger JPY | 106 | |||||||||||
105 | 8-Aug | 19-Sep | 14-Nov | 28-Nov | 9-Jan | 105 | |||||||
25-Jul | 22-Aug | 5-Sep | 3-Oct | 17-Oct | 31-Oct | 12-Dec | 26-Dec | 23-Jan | |||||
Source: Bloomberg, Data as of January 24th | |||||||||||||
10- Year Government Bond Spreads | |||||||||||||
bps | Italy | Portugal | Spain | bps | |||||||||
240 | 240 | ||||||||||||
220 | 220 | ||||||||||||
200 | 200 | ||||||||||||
180 | 180 | ||||||||||||
160 | 160 | ||||||||||||
140 | 140 | ||||||||||||
120 | 120 | ||||||||||||
100 | 100 | ||||||||||||
80 | 80 | ||||||||||||
60 | 60 | ||||||||||||
40 | 40 | ||||||||||||
20 | 8-Aug | 22-Aug | 19-Sep | 3-Oct | 14-Nov | 28-Nov | 26-Dec | 9-Jan | 20 | ||||
25-Jul | 5-Sep | 17-Oct | 31-Oct | 12-Dec | 23-Jan | ||||||||
Source: Bloomberg - Data as of January 24th | |||||||||||||
Gold ($/ounch) | |||||||||||||
$/ounch | Gold | $/ounch | |||||||||||
1.590 | 1.590 | ||||||||||||
1.570 | 1.570 | ||||||||||||
1.550 | 1.550 | ||||||||||||
1.530 | 1.530 | ||||||||||||
1.510 | 1.510 | ||||||||||||
1.490 | 1.490 | ||||||||||||
1.470 | 1.470 | ||||||||||||
1.450 | 1.450 | ||||||||||||
1.430 | 1.430 | ||||||||||||
1.410 | 1.410 | ||||||||||||
1.390 | 8-Aug | 19-Sep | 14-Nov | 28-Nov | 26-Dec | 9-Jan | 1.390 | ||||||
25-Jul | 22-Aug | 5-Sep | 3-Oct | 17-Oct | 31-Oct | 12-Dec | 23-Jan |
Source: Bloomberg, Data as of January 24th
National Bank of Greece | Economic Research Division | Global Markets Analysis
9
NBG Global Markets Roundup | Equity Market Valuation Metrics
US Sectors Valuation
N A T I O N A L B A N Κ
O F G R E E C E
Price ($) | EPS Growth (%) | Dividend Yield (%) | P/E Ratio | P/BV Ratio | ||||||||||
24/1/2020 % Weekly Change | 2019 | 2020 | 2019 | 2020 | 2019 | 2020 | 12m fwd 10Yr Avg | 2019 | 2020 | 12m fwd 10Yr Avg | ||||
S&P500 | 3295 | -1,0 | 1,2 | 9,6 | 1,8 | 1,9 | 20,2 | 18,6 | 18,5 | 15,0 | 3,6 | 3,4 | 3,4 | 2,5 |
Energy | 430 | -4,2 | -28,9 | 23,2 | 3,8 | 4,3 | 21,7 | 16,7 | 16,6 | 19,7 | 1,6 | 1,5 | 1,5 | 1,8 |
Materials | 375 | -2,3 | -15,6 | 12,1 | 2,1 | 2,2 | 20,2 | 18,0 | 17,9 | 14,7 | 2,4 | 2,3 | 2,3 | 2,5 |
Financials | ||||||||||||||
Diversified Financials | 758 | -1,5 | 1,7 | 6,2 | 1,4 | 1,6 | 16,2 | 15,4 | 15,3 | 13,8 | 1,9 | 1,8 | 1,8 | 1,5 |
Banks | 359 | -3,2 | 9,0 | 3,6 | 2,6 | 3,0 | 12,3 | 11,4 | 11,4 | 11,1 | 1,4 | 1,3 | 1,3 | 1,0 |
Insurance | 444 | -1,4 | 15,7 | 7,9 | 2,2 | 2,3 | 13,4 | 12,5 | 12,4 | 10,8 | 1,5 | 1,4 | 1,4 | 1,1 |
Real Estate | 248 | 1,0 | 1,9 | 5,7 | 3,1 | 3,1 | 21,0 | 20,5 | 20,4 | 18,3 | 3,7 | 3,9 | 3,9 | 3,0 |
Industrials | ||||||||||||||
Capital Goods | 741 | -1,2 | -6,5 | 15,3 | 1,9 | 2,0 | 21,1 | 18,3 | 18,2 | 15,5 | 5,5 | 4,7 | 4,7 | 3,4 |
Transportation | 802 | -1,2 | 6,6 | 4,8 | 1,9 | 2,0 | 14,7 | 14,3 | 14,2 | 13,6 | 4,3 | 3,9 | 3,9 | 3,4 |
Commercial Services | 369 | 1,1 | 12,9 | 8,7 | 1,3 | 1,3 | 28,5 | 27,2 | 27,0 | 19,8 | 6,0 | 5,8 | 5,8 | 3,4 |
Consumer Discretionary | ||||||||||||||
Retailing | 2458 | -0,9 | 3,8 | 12,0 | 0,8 | 0,8 | 32,9 | 29,1 | 28,8 | 21,1 | 12,7 | 10,8 | 10,7 | 6,1 |
Media | 685 | -1,8 | 3,6 | 17,0 | 0,4 | 0,4 | 27,5 | 23,7 | 23,5 | 20,0 | 4,2 | 3,7 | 3,7 | 3,2 |
Consumer Services | 1328 | -3,0 | 5,0 | 11,0 | 2,1 | 2,3 | 23,9 | 21,5 | 21,4 | 19,2 | 14,8 | 13,7 | 13,7 | 6,3 |
Consumer Durables | 375 | -1,6 | 0,4 | 9,9 | 1,4 | 1,5 | 19,2 | 17,7 | 17,6 | 16,8 | 4,0 | 3,7 | 3,6 | 3,2 |
Automobiles and parts | 113 | -2,4 | -16,4 | 18,5 | 4,2 | 4,2 | 8,5 | 7,1 | 7,1 | 8,4 | 1,4 | 1,2 | 1,2 | 1,7 |
IT | ||||||||||||||
Technology | 1698 | -0,2 | 2,7 | 9,1 | 1,3 | 1,4 | 21,6 | 20,3 | 20,2 | 12,6 | 9,7 | 10,0 | 10,0 | 3,6 |
Software & Services | 2438 | -0,2 | 11,2 | 12,5 | 1,0 | 1,0 | 29,2 | 26,7 | 26,5 | 17,2 | 7,9 | 7,6 | 7,5 | 5,1 |
Semiconductors | 1316 | 2,9 | -12,3 | 7,5 | 1,8 | 1,8 | 18,9 | 18,5 | 18,4 | 13,9 | 5,5 | 5,4 | 5,3 | 3,1 |
Communication Services | 188 | -1,4 | 2,9 | 12,0 | 1,2 | 1,2 | 21,8 | 19,6 | 19,5 | 17,3 | 3,5 | 3,1 | 3,1 | 2,8 |
Consumer Staples | ||||||||||||||
Food & Staples Retailing | 489 | 0,0 | 2,9 | 4,8 | 1,7 | 1,8 | 21,5 | 20,5 | 20,5 | 16,0 | 4,6 | 4,3 | 4,3 | 3,1 |
Food Beverage & Tobacco | 729 | -0,1 | -1,7 | 6,2 | 3,3 | 3,3 | 19,7 | 19,0 | 18,9 | 17,4 | 5,3 | 5,1 | 5,1 | 4,9 |
Household Goods | 750 | -1,5 | 6,6 | 7,9 | 2,3 | 2,4 | 25,8 | 24,1 | 24,0 | 19,1 | 8,9 | 8,7 | 8,7 | 5,0 |
Health Care | ||||||||||||||
Pharmaceuticals | 979 | -2,8 | 9,3 | 8,2 | 2,1 | 2,3 | 16,0 | 14,6 | 14,5 | 14,4 | 5,5 | 4,5 | 4,4 | 3,4 |
Healthcare Equipment | 1402 | -1,1 | 10,3 | 9,7 | 1,0 | 1,1 | 20,4 | 18,7 | 18,6 | 15,1 | 3,7 | 3,3 | 3,3 | 2,6 |
Utilities | 347 | 2,4 | 4,9 | 4,7 | 3,1 | 3,1 | 20,7 | 21,0 | 21,0 | 15,6 | 2,2 | 2,3 | 2,3 | 1,6 |
Source Factset, Blue box indicates a value more than +2standard devation from average, light blue a value more than +1standard devation from average. Orange box indicates a value less than -2standard devation from average, light orange a value less than -1standard devation from average
1-month revisions to 2020 & 12-month Forward EPS | 12-month revisions to 2020 & 12-month Forward EPS |
Earnings Revisions indicate 1-month change in 2020 & 12-month Forward EPS | Earnings Revisions indicate 12-month change in 2020 & 12-month Forward EPS | ||||||||||||||||||||||
% | |||||||||||||||||||||||
2020 | % | 2020 | |||||||||||||||||||||
2,0 | |||||||||||||||||||||||
12-month forward | 15 | ||||||||||||||||||||||
1,5 | 12-month forward | ||||||||||||||||||||||
1,0 | 10 | ||||||||||||||||||||||
0,5 | 5 | ||||||||||||||||||||||
0,0 | 0 | ||||||||||||||||||||||
-0,5 | -5 | ||||||||||||||||||||||
-1,0 | -10 | ||||||||||||||||||||||
-1,5 | |||||||||||||||||||||||
-2,0 | -15 | ||||||||||||||||||||||
-2,5 | -20 | ||||||||||||||||||||||
-3,0 | Health Care | S&P500 | -25 | ||||||||||||||||||||
IT | Consumer Staples | Financials | Real Estate | Energy | Utilities | Comm Services | Cons Discretionary | Materials | Industrials | Health Care | Utilities | Comm Services | Real Estate | Consumer Staples | IT | S&P500 | Financials | Cons Discretionary | Industrials | Materials | Energy |
Source: Factset, Data as of January 24th | Source: Factset, Data as of January 24th |
12-month forward EPS are 93% of 2020 EPS and 7% of 2021 EPS | 12-month forward EPS are 93% of 2020 EPS and 7% of 2021 EPS |
National Bank of Greece | Economic Research Division | Global Markets Analysis |
10
NBG Global Markets Roundup | Equity Market Valuation Metrics
Euro Area Sectors Valuation
N A T I O N A L B A N Κ
O F G R E E C E
Price (€) | EPS Growth (%) | Dividend Yield (%) | P/E Ratio | P/BV Ratio | ||||||||||
24/1/2020 % Weekly Change | 2019 | 2020 | 2019 | 2020 | 2019 | 2020 | 12m fwd 10Yr Avg | 2019 | 2020 | 12m fwd 10Yr Avg | ||||
EuroStoxx | 410 | -0,5 | 2,6 | 8,4 | 3,1 | 3,2 | 16,7 | 15,5 | 15,4 | 13,2 | 1,7 | 1,7 | 1,7 | 1,4 |
Energy | 318 | -2,8 | -10,1 | 16,7 | 4,9 | 5,4 | 13,8 | 11,3 | 11,2 | 11,4 | 1,3 | 1,2 | 1,1 | 1,2 |
Materials | 492 | 0,1 | 13,9 | 8,1 | 3,1 | 3,3 | 15,4 | 14,4 | 14,4 | 14,1 | 1,9 | 1,8 | 1,8 | 1,4 |
Basic Resources | 192 | -1,4 | -61,6 | 49,1 | 3,3 | 3,4 | 19,3 | 12,5 | 12,4 | 13,6 | 0,8 | 0,7 | 0,7 | 0,9 |
Chemicals | 1160 | -0,1 | -12,7 | 8,6 | 2,6 | 2,8 | 21,8 | 20,1 | 20,0 | 15,0 | 2,1 | 2,0 | 2,0 | 2,2 |
Financials | ||||||||||||||
Fin/al Services | 533 | 1,9 | 25,4 | -6,0 | 2,4 | 2,5 | 15,8 | 17,4 | 17,3 | 14,1 | 1,7 | 1,6 | 1,6 | 1,3 |
Banks | 93 | -2,7 | -1,6 | 3,6 | 5,7 | 6,0 | 9,3 | 8,6 | 8,6 | 10,0 | 0,6 | 0,6 | 0,6 | 0,7 |
Insurance | 304 | 0,3 | 13,0 | 5,1 | 4,8 | 5,1 | 11,0 | 10,4 | 10,4 | 9,2 | 1,0 | 1,0 | 1,0 | 0,9 |
Real Estate | 254 | 1,5 | 0,1 | 4,4 | 4,2 | 4,2 | 19,1 | 18,9 | 18,8 | 16,7 | 1,0 | 1,0 | 1,0 | 1,0 |
Industrial | 977 | 0,7 | 11,4 | 12,1 | 2,3 | 2,5 | 20,3 | 18,6 | 18,4 | 15,1 | 3,2 | 3,0 | 3,0 | 2,3 |
Consumer Discretionary | ||||||||||||||
Media | 226 | 0,0 | 9,5 | 9,4 | 3,3 | 3,5 | 17,2 | 15,7 | 15,6 | 15,7 | 2,3 | 2,2 | 2,2 | 2,0 |
Retail | 599 | -2,4 | 3,4 | 10,7 | 2,5 | 2,8 | 25,0 | 22,4 | 22,3 | 18,6 | 3,9 | 3,6 | 3,6 | 2,8 |
Automobiles and parts | 460 | -3,9 | -12,1 | 8,8 | 3,7 | 4,1 | 8,8 | 7,5 | 7,5 | 8,7 | 0,9 | 0,8 | 0,8 | 1,0 |
Travel and Leisure | 204 | -3,3 | -4,8 | 24,4 | 2,0 | 2,2 | 15,7 | 12,0 | 11,9 | 14,7 | 1,9 | 1,7 | 1,7 | 1,8 |
Technology | 642 | 0,6 | 6,3 | 11,4 | 1,2 | 1,0 | 26,5 | 24,4 | 24,2 | 18,1 | 4,2 | 4,0 | 3,9 | 3,0 |
Communication Services | 293 | 0,6 | -14,2 | 18,4 | 4,2 | 4,4 | 17,5 | 14,9 | 14,8 | 14,0 | 1,9 | 1,8 | 1,8 | 1,8 |
Consumer Staples | ||||||||||||||
Food&Beverage | 606 | -1,6 | 16,8 | 5,8 | 2,1 | 2,2 | 20,5 | 19,5 | 19,4 | 18,4 | 2,7 | 2,5 | 2,5 | 2,6 |
Household Goods | 1101 | -1,5 | 6,9 | 11,3 | 1,6 | 1,8 | 29,6 | 26,9 | 26,7 | 20,6 | 6,1 | 5,6 | 5,5 | 3,7 |
Health care | 894 | -0,8 | 7,3 | 8,8 | 2,1 | 2,2 | 20,1 | 18,4 | 18,2 | 15,0 | 2,4 | 2,3 | 2,3 | 2,1 |
Utilities | 378 | 2,9 | 56,2 | 8,7 | 4,5 | 4,5 | 16,1 | 15,9 | 15,9 | 12,6 | 1,6 | 1,6 | 1,6 | 1,1 |
Source Factset, Blue box indicates a value more than +2standard devation from average, light blue a value more than +1standard devation from average. Orange box indicates a value less than -2standard devation from average, light orange a value less than -1standard devation from average
1-month revisions to 2020 & 12-month Forward EPS | 12-month revisions to 2020 & 12-month Forward EPS |
Earnings Revisions indicate 1-month change in 2020 & 12-month Forward EPS | Earnings Revisions indicate 12-month change in 2020 & 12-month Forward EPS |
% | 2020 | % |
3 | 20 | |
12-month Forward | ||
15 | ||
2 | 10 | |
5 | ||
1 | 0 | |
-5 | ||
0 | -10 | |
-15 | ||
-1 | -20 | |
-25 | ||
-30 | ||
-2 | -35 | |
-40 | ||
-3 | -45 |
2020 |
12-month Forward |
Media Travel and Leisure Technology Utilities Fin/al Services Household Goods Health care Food&Beverage Basic Resources Banks Industrial Autos and parts EuroStoxx Retail Materials Insurance Real Estate Energy Comm Services Chemicals | Utilities Materials Insurance Media Household Goods Health care Industrial Food&Beverage Fin/al Services Retail Technology EuroStoxx Real Estate Energy Travel and Leisure Chemicals Banks Comm Services Autos and parts Basic Resources | |
Source: Factset, Data as of January 24th | Source: Factset, Data as of January 24th | |
12-month forward EPS are 93% of 2020 EPS and 7% of 2021 EPS | 12-month forward EPS are 93% of 2020 EPS and 7% of 2021 EPS | |
National Bank of Greece | Economic Research Division | Global Markets Analysis |
11
NBG Global Markets Roundup | Disclosures & Analyst Certification
N A T I O N A L B A N Κ
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DISCLOSURES:
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National Bank of Greece SA published this content on 28 January 2020 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 28 January 2020 12:44:01 UTC