Julius Baer: Comentarios sobre Resultados Corporativos | Bonos europeos | Grecia | Oro

Redacción - Lunes, 22 de Enero

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The week ahead: Earnings season in full swing 80+ companies in the S&P 500 index are scheduled to report and some 20+ in its European counterpart, the Stoxx 600. The earnings season is in full swing. Other than that the World Economic Forum in snowy Davos will certainly yield some headlines. In macro terms, the business surveys in Europe, the Bank of Japan and the European Central Bank update as well as flash purchasing managers’ indices are on the radar this week.

100+ companies reporting, the Davos summit and plenty of macro numbers will make this an intense week for investors. Not to mention the budget haggle in Washington possibly reversing the shutdown.

 

Christian Gattiker, Chief Strategist and Head Research, Julius Baer

 

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European government bonds: too early for the ECB to announce a change in guidance

 

Spain’s government bond rating has been upgraded by Fitch to A- from Baa+, Greece has also seen the rating lifted by Standard &Poor’s, and the US once again experiences a shutdown of non-essential government operations. The biggest topic for the bond market, however, will be the press conference of the European Central Bank (ECB) scheduled for Thursday. Investors will recall that the minutes of the December meeting caused a sharp correction of the European government bonds. According to the December minutes (also called ‘accounts’), several members of the ECB Board questioned the need for monetary support and saw the necessity to prepare the market for a tightening move. Ever since then, the market has debated the likelihood of ECB President Draghi changing his forward guidance. Up to now, the ECB has kept stating that rates will remain unchanged longer than the ECB purchases government bonds (current programme supposed to end in September).

 

We still expect the ECB to wait until 2019 to raise rates. That said, we still do not see value in any segment the ECB is distorting with its outsized purchases, i.e. government debt and non-financial corporate bonds. We still see subordinated debt of solid European banks as one of the few segments that still generates a decent yield.

 

Markus Allenspach, Head Fixed Income Research, Julius Baer

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Greece: S&P upgrade by one notch to B with positive outlook

 

On Friday, Standard & Poor’s (S&P) upgraded Greece to B from B- with a positive outlook. The upgrade is based on Greece’s improved growth outlook and labour market recovery supported by its ability to finance itself in the market and the government’s commitment to reform progress. S&P expects Greece to grow at 2.4% on average over 2018-2021. The Greek banking systems remains impaired with high levels of non-performing loans, although initiatives are on the way and there is no expectation of another recapitalisation at the moment.

 

We note that Greece’s government debt still remains high at approximately 180% gross domestic product. Once Greece’s bailout programme expires in August 2018, creditors will need to discuss the debt relief measures they will take.

 

Eirini Tsekeridou, Fixed Income Analyst, Julius Baer

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Gold: Unimpressed by the government shutdown

 

The threat of a US government shutdown became reality over the weekend as Democrats and Republicans failed to reach an agreement on a budget. Negotiations will continue today, leaving the situation highly in flux and adding to uncertainty. Yet, the gold market hardly reacted to the shutdown this morning. Prices are broadly unchanged from Friday’s close but remain supported by a weak US dollar, which is partly reflecting the financial market’s unease with the political back-and-forth in the United States. Whether or not the shutdown will have an impact on the gold market largely depends on its duration and implications on the US economy. Judging by the prevailing positive sentiment in financial markets, e.g. US equities reaching new all-time highs on Friday, it seems as if it is not considered a major concern. Looking back at the previous shutdown in October 2013, it did not have a positive impact on gold. Prices were down during the shutdown and temporarily rebounded thereafter before resuming their longer-term downtrend. At the current point in time, the US dollar remains gold’s primary driver. As we put it last week, gold trades in ‘currency mode’ rather than in ‘commodity mode’. While the dollar is unlikely to return to its peak, we still see upside from current levels as accelerating growth should be accompanied by rising interest rates in the United States. This should weigh on gold over the coming months, justifying an unchanged cautious view. These short-term rate cycle headwinds should however fade as the year progresses, opening up bottom-fishing opportunities.

 

Thus far, the gold market is unimpressed by the US government shutdown but prices remain supported by a weak US dollar. Whether or not the shutdown will have an impact on the gold market largely depends on its duration and implications on the US economy. Expecting a rebound of the US dollar, we stick to our cautious view.

 

Carsten Menke, Commodities Research Analyst, Julius Baer

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