Alicia García-Herrero (Natixis) | Out of the key reasons for the cyclical slowdown in 2018, namely the worsening sentiment due to the US-China trade war and the rapid shadow banking crackdown, the former can be considered as an external shock but the latter is self-inflicted.
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.
Not everything is rallying this year. India is down, which is interesting as it is a perennial favourite with international investors. Mark Tinker, Head of AXA Framlington Equities in Asia, is concerned “notably” concerned about the extent and composition of India’s growth compared to China as well as the fact that since 2013 the Chinese currency has depreciated 8% against the US Dollar while the Rupee has dropped 31%.
Pablo Pardo | With his trade war, Trump has accelerated the slowdown in China, and now the world´s second economy is buying fewer goods and services from the US. And from the rest of the world in general. Not only Apple has declared that its profits are going to be reduced by China´s slowdown. Also, for example, its main rival outside China, Samsung.
Xu Xueming via Caixin | Private enterprises have recently faced liquidity problems, resulting from refinancing issues and the pledged-share crisis. For some of them, the reason lies in difficulties in their own operations. How do we solve the problems of private enterprises’ rising nonperforming loans, bond defaults and refinancing difficulties, and also manage the risk of forced sales of stocks pledged as collateral by controlling shareholders?
Shaun Riordan | I have been reading a whole series of market forecasts for 2019. While it is relieving that at last they include political or geopolitical factors, I was struck by those factors, which could have dramatic impact on companies or markets which were left out, or misinterpreted.
A more severe than expected economic downturn, the ongoing US-China trade war, eventually a hard Brexit, and unsolved challenges such as protectionism or the lack of confidence in the euro. Here are some trends that will impact markets in 2019.
Alicia García-Herrero*| Without an expectation of a larger market for European exports in the absence of additional opening up by Chinese authorities, European exporters should not enjoy the ongoing China-US negotiations.
By Yang Ge via Caixin | Offshore listings by Chinese firms surged to record highs in 2018, fueled by strong demand from global investors chasing some of China’s hottest names, especially in the technology sector. That listing wave is expected to continue into 2019, but could quickly peter out if recent bearish sentiment becomes the norm, observers said.
