2017 is drawing to an end, and the bottom line is positive. The outcome is significantly better than we had expected. Since the financial crisis in 2008, the global economy has never expanded more quickly and especially concertedly than in 2017. Also, inflation has surprised on the downside, falling short yet again of the expectations held by central banks and analysts.
Autor: Tamas Menyhart, Fund Manager Equities, Erste Asset Management
After years of drought, European bank shares have shown a solid performance in the year to date. Read more
The IFO business climate index calculated by the Munich-based IFO Institute is regarded as the most important German economic indicator. At 115.1, the value released for June last week was the highest since the launch in January 1991. It was also clearly above the value that had been expected by the financial analysts on average. The signs for substantial economic growth in Germany seem favourable.
The global economy is growing moderately, inflation is low, and the monetary policy is loose. This environment supports many asset classes from bonds to equities. The political uncertainty has been absorbed rather well so far too. Will this situation last?
Author: Dieter Kerschbaum, Communications Specialist Austria
On 31 May the Vienna Stock Exchange Award will be celebrated and awarded to the winner. The day is dedicated to the financial centre of Austria, and the award is accompanied by numerous other events that are geared towards drawing investors’ attention to the domestic stock exchange. Erste Asset Management is one of the biggest investors at the Vienna stock exchange. In the past five years, the Vienna stock exchange has seen a clear upward trend. We spoke about the reasons for the steep upswing, possible risks, and the future perspective with Bernhard Ruttenstorfer, manager of the equity fund ESPA STOCK VIENNA:
Author: Sevda Sarp
After the ballots were counted on 16 April 2017, the state-run Anadolu news agency reported that “Yes” had won by securing 51.4% of the votes, which was later also confirmed by the Electoral Commission. Serious concerns were raised by the OSCE. It is also important to note that the referendum took place during a “state of emergency”. That is to say, in a highly repressive climate in which the President and the government controlled the media, jailed critical journalists and leaders of pro-Kurdish parliamentary opposition, and arbitrarily detained and prosecuted the President’s opponents. The result of the referendum has paved the way for the most controversial changes that Turkey has faced in its history.
Austria celebrates the 300th birthday of Maria Theresa. She was born on 13 May 1717 in Vienna. It was her who founded the Vienna stock exchange in 1771 on the basis of an imperial patent (see image), after an earlier, failed attempt in 1761. Even though a lot has changed politically, economically, and technically since then, the eventful history of the Vienna stock exchange is still very instructive for every investor.
At this year’s IT trade fair CEBIT, the focus was on robots that support humans in their daily routine; on drones that can be used for difficult jobs in the field such as oil rigs; driverless electro busses that are steered by sensors and accelerate and stop autonomously; and various other technological innovations that are no fiction but have in fact already entered our daily lives. Of what relevance are they for the economy, for companies, for consumers – and for investors?
The stock exchanges in the emerging economies and their performances have fallen short of expectations in recent years. Speculations about the weakening economy of China, the decline of commodity prices, and an appreciating US dollar have had a detrimental effect on emerging markets. However, the trust of investors in these markets has been making a comeback since 2016. In spite of Donald Trump’s election victory and the fear of a US policy of protectionism, the emerging economies are currently outperforming the developed ones.
Many investors focus on capital gains while disregarding the significance of dividends. And are wrong in doing so, from my point of view. The total return of a share is after all the sum of capital gains (i.e. rising prices) and dividend income. Income from dividends is of particular relevance for investors with a long-term investment horizon.