ECB commits to more assertive defence of eurozone cohesion
While closing the door on a seven-year era of negative interest rates with a larger than anticipated rate hike, the European Central Bank on Thursday committed itself to a more assertive defence of cohesion between the 19 economies that use the euro. President Christine Lagarde described the move as “a rather historical moment”.
Markets see ‘considerable risks’ in ECB's new TPI tool
Financial markets expect a further increase of 140 basis points in European Central Bank interest rates by the end of the year, suggesting a steady path of increases of half a percent per six-weekly meeting. Worsening economic conditions in the coming months could however lead to an early shortening of the tightening cycle. It is balancing on a thin rope, investors and strategists tell Investment Officer.
Esma sees room to improve prospectus approvals
A European screening exercise of prospectus approvals that involved Luxembourg’s financial supervisor CSSF has concluded that EU regulators need to be more efficient in their assessments and that more clarity needs to be provided on the use of “additional criteria” that national supervisors apply.
Modern pension funds embrace ESG as ‘good ancestors’
Social responsibility, sustainability, ESG and SRI are more than buzzwords for the world’s leading pension funds. While some still question the current classifications, taxonomies and regulatory timelines, many of these major institutional investors see it as a way to provide stewardship, being a long-term stakeholder in society. “So are we going to be good ancestors? Or not?”
‘Analysts overly upbeat on corporate profits’
Barely seven of the first 35 companies in the US S&P 500 index to release their second-quarter results subsequently have raised their earnings per share forecast for the third quarter. Are earnings expectations and analysts still too optimistic?
Some 77 percent of those companies saw their Q3 2022 expectations revised downwards. The average estimated change is -3.0 percent, according to The Earnings Scout.
Fitch affirms AAA rating for Luxembourg
Ratings agency Fitch Ratings has affirmed its assessment of Luxembourg’s government debt with a ‘AAA’ rating and a stable outlook.
Crisis in Italy brings back fears of eurozone crisis
The eurozone looks increasingly weak. The euro slipped to parity with the dollar last week and a peripheral debt crisis threatens if interest rates rise sharply. With Italian Prime Minister Mario Draghi’s departure announced on Thursday, the stability of the euro is anything but certain.
First German trade deficit in 31 years shows EU’s vulnerability
Germany has unexpectedly reported its first trade deficit since 1991. The reversal of the trade balance in Europe’s largest economy shows how difficult it is for German companies to handle rising costs of oil and gas. Economists at ABN Amro and Nomura meanwhile expect Europe will enter into a recession.
BMO GAM Emea rebrands as Columbia Threadneedle
US asset manager Columbia Threadneedle on Monday said it has completed the rebranding of the European activities of BMO Global Asset Management, bringing its products and savings plans together under a single brand.
‘Lack of taxonomy harmonisation leads to fragmentation’
The sustainable fund market in Luxembourg and other European fund domiciles has continued its strong growth of recent years, but the short-term impact of the Ukraine war has already disrupted the move to a green future. Still, positive developments are expected in the longer term. The latest updates were set out in the 2022 edition of the European Sustainable Investment Funds Study by Zeb and Morningstar on behalf of the Association of the Luxembourg Fund Industry.