Manuela Andreoni | As Brazil braces for its most important election in decades, hopes of stabilization are dwindling. The country is slowly stepping out of an almost three year-long recession, but uncertainty over what will happen at the ballot boxes later on this year is pushing debate on how to resume growth into a distant future.
Santander’s stock price has recovered its highs prior to the summer of 2015, a period marked by deflationary pressures and political events. Alphavalue’s view is that the market is losing its fear of the bank which, up to now, has been underperforming its sector at a European level, particularly in the second half of 2015.
What was a surprise in the IMF’s updated growth estimates was the correction made to the growth forecast for Spain this year (-0.1 pp to 2.4%) given “the impact of greater political uncertainty on confidence and demand.”
The new upward cycle in the property sector seems to be consolidating. Positive proof of that is the fact that housing prices have been increasing for the last two years.
Ebro Foods has announced the acquisition of 70% of Italian fresh pasta maker Bertagni (the current shareholders and management team will maintain the remaining 30%) for 130 million euros.
It seems we have a consensus: Europe is overbanked. Zombie banks need to be allowed to fail and the process of mergers needs to be strengthened, particularly cross-border. But the US model is more of an exception than the rule and there are countries, like Spain, where the consolidation could start to be excessive.
Spanish exports have seen solid growth over the past few years. Moreover the range of destinations has broadened and the products exported diversified. However, CaixaBank Research points that there is still one important issue to resolve: the complexity of exports.
US President Donald Trump’s alleged remarks questioning why the US should take in immigrants from what he apparently called “shithole countries” — those comprising Africa, along with Haiti and El Salvador — have been met with indignation around the world.
It is expected that some Chinese local government officials may still try to fight bureaucracy with bureaucracy. For instance, when inspectors come, the officials will list how many meetings they have held, how many documents they have released and how many reports they have written to the cause.
The year that has just started looks like one of those textbooks opportunities which appear by magic at the beginning of a new year. The banking sector has risen strongly, only beaten by Metals&Mining and Automotive. For Alphavalue’s experts this ranking suggests we are not facing a shift in fundamentals. All the protagonists in the banking sector are clearly confirming that it’s not just a case of rediscovering a handful of quality names.