In Europe as well as in the US and Asia, IPO activity is picking up again after the 2020 shortage. We review below the most important expected listings throughout the year, which are coming to brighten up the markets. Specifically, the London Stock Exchange is planning the debut, in the next few days, of the fast food delivery company Deliveroo, in what will be the largest IPO in the last decade.
Rory Hopcraft, Kevin Jones and Kimberly Tam via The Conversation | It’s estimated that 90% of the world’s trade is transported by sea. As consumers, we rarely give much thought to how the things we buy make their way across the planet and into our homes. That is, until an incident like the recent grounding of a huge container ship, the Ever Given, in the Suez Canal exposes the weaknesses in this global system.
Carlos de Sousa (Vontobel) | Early on in the pandemic the IMF attempted to expand its allocation of Special Drawing Rights (SDRs) to its member states, to help developing countries cope with the crisis and provide additional global liquidity. The Trump administration blocked this effort at the time, but now the Biden administration is in charge, a consensus appears to be building among the G7 nations regarding the approval of a $500 Bn of SDR allocation.
Greg Wendt , Scott Sykes & David Daigle (Capital Group) | Global M&A activity hit $484.5 billion for January and February, up 33% compared to last year. M&A is not just a big deal in small cap. It can impact companies across equity and bond markets. With that in mind, Wendt and a few other Capital Group portfolio managers shared their views on 5 key questions about the M&A boom.
CaixaBank Research (Adriá Morron and Alex Ruiz) | Since the lowest point recorded last March, the main index for the US equity has risen almost non-stop by around 70%. In recent weeks, this rally has also been accompanied by dynamics in certain US equity segments that are reminiscent of events followed by major stock market adjustments in the past. Is the US equity market decoupling from economic fundamentals?
Peter Isackson | Two months after the departure of Donald Trump, the world is seeking to understand the contours of the new administration’s still hesitating foreign policy. US President Joe Biden made a bold step forward this week when he vowed to pursue the fantasy of Russiagate, the Democratic equivalent of QAnon.
Arman Hassanniakalager via The Conversation | The global market in government bonds has been bleeding red lately. The US ten-year strongly influences the price of everything from mortgages to business loans in the US, and by extension around the world, so such a sharp rise has the potential to reduce borrowing and weaken the economic recovery from COVID –especially when there is so much debt in the global system.
Monex Europe | Chair Powell doubled down on the tone struck by the SEP and policy statement in his press conference yesterday emphasising the need to witness substantial progress in the recovery before signalling the exit of post-pandemic policy measures. The tone taken by Powell suggests the Federal Reserve will happily sit behind the curve as inflation overshoots in the coming years, helping to further push back rate expectations and anchor real rates in bond markets.
Pablo Pardo (Washington) | What if it turns out that we are going to come out of the Covid-19 recession too quickly? In Europe that sounds like a joke, of course, thanks to the disaster organized by the European Commission with the purchase of the vaccines, and the insistence of the northern EU countries that no funds should be committed for the revival of the lazy southern ones. But that is not the case in the US, where the vaccine campaign is going much faster, and the public authorities have not been shy about spending to stimulate the economy.
Portcolom AV | In the 1980s, “bond vigilantes” began to be referred to as the watchdogs of the economy. It was said that if the monetary and fiscal authorities did not regulate the economy properly, bond investors would. So if a central bank, for example, lagged in its monetary policies, the watchers would force it to act through pressure on bond market prices. Will the bond vigilantes return considering the attitude of central banks and governments in the face of rising inflation?