Market updates

The unravelling of Evergrande is causing jitters across markets. In this Market Update Carlos de Sousa explains why Evergrande is not too big to fail and how investors should look past the noise.

Our base case is for a continuation of quite high growth and a modest inflation overshoot. For bond investors, positioning for stagflation could be a dangerous trade if that base case bears out

It will take time for this sector to recover and we are likely to see more suppliers collapse in the coming weeks and months.

Due to the EU's "Fit for 55" package, the energy requirements of the building sector for indoor climate control are increasingly becoming the focus of European sustainability efforts. Companies that can supply energy-efficient heating and cooling solutions for buildings will be able to benefit from this new push by the EU. The Swedish company NIBE is one of the pioneers in this field.

With ample job openings, inflation well ahead of target, financial conditions that are certainly not tight and strong economic growth, the obvious question is what does the Fed need to see to finally start tapering its asset purchases?

BWIC – or bids wanted in competition – lists, are a unique characteristic of the ABS and CLO markets, where they are widely used in secondary trading when investors are looking to sell bonds.

As we rapidly descend upon the fourth quarter of this extraordinary year, we think some of the risks fixed income investors faced back in Q1 will rear their heads again before the end of 2021.

Despite the impressive returns of Euro HY over the last year or so, the backdrop for the asset class continues to suggest there is more upside to come.

This supply surge can be very welcome for those investors with cash to put to work, though it is also eyed with caution.

Some believe inflation is dead, while others consider that we are witnessing its resurrection. Various short- and long-term factors speak in favor of either one or the other thesis. Which of these factors are stronger? And what impact will the future inflation environment have on investors and asset classes anyway?

As the Delta variant establishes a hold in many countries, forcing some governments to re-assess reopening policies, the market is beginning to feel its impact. The implication on growth remains unclear, but early indications suggest the growth rate may have peaked for this year, albeit continuing its recovery.

Last week, Morgan Stanley successfully brought the first public German Multifamily CMBS deal (HAUS - Eloc 39) to market since 2013. Despite coming to the market in the middle of the summer, the deal has attracted strong demand across the capital stack.