Shaun Riordan │Many of us are already enjoying our summer holidays. Others are packing now, looking forward to relaxing on the beach, or in the mountains. Wherever we are taking our holidays we should make the most of them. A perfect storm is brewing which could hit Europe hard in the autumn, with devasting economic and political consequences.
David F. Lafferty (Natixis) | Volatility has returned and the red hot stock market that began the year has now downshifted closer to neutral. While the macro data continues to be lackluster – consistent with our view that the global economy is decelerating towards potential – much of the recent malaise has been driven by the on-again, now off-again US/China trade negotiations.
Santander Corporate & Investment | The publication of results is nearing its end, and European company profits have shown resilience in face of a global environment dominated by uncertainty: the trade war, volatility in emerging markets and weakness in their currencies, Brexit, the growth of populism etc. Spanish companies are very exposed to international markets, given that only a third of their benefits come from the domestic market.
Alicia Garcia Herrero (Natixis/Bruegel) | Only a few days before Li Keqiang’s official visit to Brussels for the EU-China summit on April 2019, Xi Jinping has conducted his second trip to Southern Europe in only five months. Such a keen interest in Southern Europe is hard to understand, especially if one considers that Chinese high level officials are busy negotiating with the US to reach a deal to halt the trade war.
David Mahon via Caixin | There is an African proverb that states, “When elephants fight, it is the grass that suffers.” Small nations will suffer considerable economic losses if they take firm sides with either the United States or China in the current trade war.
Wang Tao via Caixin | The meeting between Xi and Trump on Dec. 1 turned out better than expected. According to both the White House statement and Chinese official reports, both sides agreed to enter into immediate negotiations on a broad range of structural issues in the next 90 days, and not impose additional tariffs in the meantime.
Alicia García Herrero | 2018 will be recalled as the year in which the US wake up to China’s economic power through a trade war. The question to ask ourselves now is how this may affect Europe. The first issue to realize is that European and US exports into China are very similar, which points to a potential substitution of American products in the Chinese market but also the other way around, namely substituting Chinese exports into the US by European ones.
Guntram Wolff via Caixin | The EU remains a long-standing ally of the U.S. — despite its trade surplus. The successful negotiations of European Commission President Jean-Claude Juncker has also helped to ease the EU-U.S. tensions, though the truce remains fragile.
David Page (AXA IM) | We believe the US has been using tariffs primarily as a negotiation tool; China appears a special focus. But domestic political motives also appear to be a driver.
The performance rating of countries for the last month demonstrates the concerns of investors about the price to be paid for a de-globalization of the world by those countries whose companies focus on exports. Alphavalue offers a ranking of these countries according to its coverage