This long term and strategic partnership includes the acquisition by Amundi of 100% of Sabadell Asset Management, which has €21.8bn of assets under management, of which €16.1bn is in Spanish-domiciled funds. The transaction value, financed via Amundi’s existing cash resources, is €430m.
Morgan Stanley | Looking ahead to 4Q, we expect modest growth in NII (+ 0.5% QoQ) and by 2020 we have -2% (Caixabank -1% and Bankia -3.5% YoY). The growth in commissions will improve by comparable easy and inflows (we expect + 4% YoY on average).
Santander Corporate & Investment | The strong funds outflow from European equities in recent years and the severe relative bad behavior of European markets vis-à-vis American ones has begun to attract the attention of some non-European investors.
Olivia Álvarez (Monex Europe) | The ECB will host its first 2020 monetary policy meeting next Thursday 23rd. The event is unlikely to bring any changes over policy tools after the accommodative package introduced in September, but rather, it could turn the attention towards any changes in the economic outlook facing the Eurozone and the strategic review vowed by new chief Christine Lagarde.
BofA| We present three scenarios for the ECB’s balance sheet in 2020 based on TLTROs and APP projections. At the top end, we estimate the ECB’s balance sheet to reach a record high; at the bottom end, we estimate a small decline. Banks’ interest in TLTRO III would be crucial in determining the actual outcome.
Alphavalue | A third of Spanish telco Telefonica’s board has bought shares since the fall of August. The investment is around € 26 million, led by Francisco Riberas. Pallete, Echenique, García Blanco, Vilá and Carvajal have also acquired titles.
CdM | Allianz Global Investors expects dividend payments of approximately 359 billion euros from European companies in 2020. This sum exceeds the 2019 record by 3.6% (12 bn euros). Dividends have contributed an average of 38% to the performance of European equities since 1974. On the contrary, 60% of government bonds in the euro zone have a negative nominal return.
DWS | Once again, strange things begin to happen in the subprime (that is, higher risk) segment of the US consumer loan market. We can see it, without going any further, in the delinquency rates of credit card balances held by thousands of small US commercial banks. Since autumn 2016, the percentage of delinquent loans (defined as loans with overdue balances for thirty days or more that continue to accrue interest) among these banks has doubled to approximately 6%, a figure higher than the levels reached during the financial crisis 2008. On the contrary, the loan books linked to credit cards of the one hundred largest banks are much more healthy.
BofA | We turn tactically neutral on European equities: We lower our weighting on European equities from positive to neutral following the 14% rally since August. Our macro projections remain unchanged: we expect a further 1.5 points upside for the Euro area composite PMI new orders to 52 by February, following the 2-point rise since September.
Neil Dwane (Allianz) | The financial markets are signalling that the situation in the Middle East won’t get out of hand, but US-Iran friction could continue for some time. The defence industry and oil and gas-related sectors could remain well-supported, but overall we believe investors should be cautious yet patient. Look to higher-quality stocks with lower correlations to the broader market and “hunt for income” if headline volatility is a risk you wish to avoid.