Erste Asset Management - Blog

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Paul Severin am 31st August 2016

Spotlight on: corporate bonds

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ESPA RESERVE CORPORATE: 3 questions for Bernd Stampfl, fund manager.

 

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Peter Szopo am 24th August 2016

Global equities – A fragile rally

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The Brexit-vote was a non-event, it seems. At least, that is what global equity markets are telling us. Since June 24 – the day after the referendum – US, European and Japanese indices all have gained around 10% in local currencies (up to August 19). Emerging Markets, on average, made a similar move as well. Whether the rally will continue depends on a number of factors, pointing in opposing directions. While the fundamental backdrop suggests remaining cautious and also valuation is not supportive, low bond yields and economic policy will likely continue to provide tailwinds for global equity markets.

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Paul Severin am 16th August 2016

Emerging markets bonds: “Responsibility and growth are not mutually exclusive”

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The global, sustainable corporate bond fund ERSTE RESPONSIBLE BOND EMERGING CORPORATE has clearly passed the threshold of EUR 100mn of assets under management. A perfect occasion to take stock. Christian Schön, member of the board of directors of Erste Asset Management, explains what role sustainable investments play in emerging markets, especially in the corporate bond segment.

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Gast-AutorIn / Guest Author am 10th August 2016

Brazil: Hope for change stimulates bonds

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Author: Felix Dornaus, Senior Fund Manager Emerging Markets Bonds

Felix Dornaus, Senior Fund Manager Emerging Markets Bonds
Felix Dornaus, Senior Fund Manager Emerging Markets Bonds
Brazil tactically overweighted at the moment

Most of the fundamental economic data are currently not good. In 2016, the country is in recession; for 2017, a minor growth rate of +0.7% is expected. The nominal budget deficit of 2016 is about -10%, with a primary deficit of -2.7%. This comes as a surprise, given that investors had been used to primary surpluses from Brazil. The current account is also slightly in deficit. The only silver lining is the low foreign government debt of less than 20% of GDP, accompanied by high foreign exchange reserves. We therefore do not expect any issues for bondholders with regard to the payments they are due.

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Gabriela Tinti am 08th August 2016

Brazilian equities are in demand

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Brazil is locked into a severe recession in 2016, the year of the Olympic Games in Rio de Janeiro. After negative growth of 2.5% last year, the economy will be shrinking by more than 3% in 2016. Political crises and corruption scandals in connection with the oil company Petrobras have badly affected the country. But still, the country, shaken by crisis, is in strong demand from investors.

The importance of Brazil has declined

Especially in the equity segment, the relevance of Brazil has declined in recent years. A few years ago the BRIC economies (Brazil, Russia, India, and China) were hugely popular among investors. Mismanagement and the unfavourable development of international commodity exchanges have eaten into the weighting of Brazil in the global …

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Gerhard Winzer am 05th August 2016

Brazil: Olympic Games of politico-economic indicators

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In Brazil, or more specifically, in Rio de Janeiro, the 31st Summer Olympics will be held in August of 2016. After Mexico City (1968), Moscow (1980), Seoul (1988), and Beijing (2008), this is only the fifth outing in the city of an emerging economy. The holding of the Games reflects the increasing economic importance of Brazil. After all, the 208 million citizens of Brazil generated goods and services worth USD 1,700bn last year. In terms of GDP, Brazil is already the world’s ninth-biggest economy.

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Gerhard Winzer am 01st August 2016

Brexit-Referendum – a Non-Event?

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Was the decision by the UK to leave the EU a non-event? Globally speaking, share prices have increased, the spreads for default risk have narrowed on many markets, and the UK central bank, i.e. the Bank of England, did not cut its key-lending rate.

Good growth rate

The economic indicators continue to suggest real economic growth of 2 to 2.5% globally. While, from a historic perspective, the growth rate is below average, in view of the disadvantageous developments such as falling productivity growth, an ageing population, weak world trade, and the pressure to deleverage, this bandwidth can actually be regarded as good.

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