Banc Sabadell | The Spanish economy faces the second half of 2019 growing at relatively high rates (we expect 2.3% yoy in 2019 vs 1.0% for the Eurozone) but with a less favourable composition of growth.
Anthony Chan (UBP) | In the run-up with regards to the on-going Sino-US trade talks, we have seen the carrot-and-stick approach from both sides as they leverage their respective negotiating power.
Moody’s warns that a broad reversal of reforms, especially of pensions or the labour market, would exert downward pressure on its rating for Spain.
José Benito de Vega | Naturgy has enjoyed a very positive stockmarket evolution since the beginning of 2018, in which period its value has increased 43% compared to an 8% fall of the IBEX35. There are various factors behind his positive performance compared to the index, which was accentuated following the presentation of its Strategic Plan in June 2018. However, after the positive evolution of its shares, it is trading with elevated multiples and at a premium to the European sector which, in our opinion, does not take account of the regulatory risk.
Link Securities | According to Spanish Carmakers Association (Anfac) data, Spain produced 294,146 vehicles in May, 6% less than the same month in 2018.
In its last report about Big tech in finance, the Bank of International Settlements (BIS) warns about the risk of a “digital monopoly” of tech companies which own their clients´ information for free.
Renta4 | Cellnex announced an issue of senior bonds convertible into shares of 700 Mn€, extendible to an additional 150 Mn€. It will be exclusive for institutional investors, will mature on 5 July 2028 with a coupon of 0.5% and a repurchase value on maturing of between 103.74% and 108.58%, which means a performance at maturity between 0.9% and 1.4%, below the average current price of the company of 2.2%.
José Ramón Díez Guijarro (Bankia Estudios) | In recent years there has been a debate in academic circles about the limits of monetary policy, once the barrier of negative interest rates has been crossed. With the additional problem that not even in Japan, where the natural interest rate has spent practically two decades in negative territory, has the central bank dared to dive deep into the zone of below zero interest rates, even though the economy has been stuck in a deflationary stagnation which has given birth to new economic jargon (japanisation) to refer to this type of economic process. The doubt is whether the Bank of Spain got is wrong by not using monetary policy more intensively or got it right be assessing the risks of traveling in this unknown territory as greater than the possible benefits.
Markus Allenspach (Julius Baer) | We maintain our Overweight on EUR low-grade bonds against the backdrop of low money-market rates and remote recession risks. Moreover, we share the view of the market that the odds for a new corporate-sector purchase programme of the European Central Bank are rising, which could additionally lift bond prices.
The G20 finance and economy ministers will meet in Fukuoka (Japan) this weekend against the backdrop of trade restrictions. The World Trade Organization estimates that between October and May, 20 new restrictions on world trade have been introduced, worth 335.9 mm. $. These measures are linked to others that previously affected a volume of trade worth 480.9 mm. $, and most worrying is that more restrictions are expected. This compensates, Intermoney analysts argue, the liberalizing measures by value of 397.2 mm. € that were taken in the last months.