Global ETF News Older than One Year
Bassanese Bites: The big squeeze
February 1, 2021--Global markets
It's great to be back for another years of Bites! Since I last wrote on December 21, global equities have essentially moved sideways (consolidating after the big push higher in November), while bond yields have pushed modestly higher. The $US is trying to bottom out, while gold remains in retreat and oil prices are trying to push higher.
In terms of fundamentals, the global economy continues to recover despite COVID still raging in Europe and the United States. Indeed, the Q4 U.S. earnings reporting season is surprising to the upside and last week we learnt that the U.S. Markit service and manufacturing PMI indicators for January remained at levels indicating solid ongoing improvement. U.S. Q4 GDP rose by a solid 4% annualised, following a 33% post-lockdown surge in Q3. Inflation remains benign. The message from central banks is that policy will remain firmly accommodative.
Source: betashares.com.au
The Pre-Pandemic Debt Landscape-and Why It Matters
February 1, 2021--Many countries entered the pandemic with elevated debt levels. Our new update of the IMF's Global Debt Database shows that global debt-public plus private-reached $197 trillion in 2019, up by $9 trillion from the previous year.
This substantial debt created challenges for countries that faced a debt surge in 2020, as economic activity collapsed and governments acted swiftly to provide support during the pandemic.
As shown in our chart of the week, a dive into the numbers reveals that the 2019 global public debt surpassed its 2007 level by 23 percentage points of GDP
Source: IMF
New Nature Economy Report II: The Future of Nature and Business
January 27, 2021-The Future of Nature and Business, the second of three reports in the World Economic Forum's New Nature Economy series, provides the practical insights needed to take leadership in shifting towards a much needed nature-positive economy.
As the world prepares to recover from the COVID-19 pandemic and resulting crisis, we are presented with an unprecedented clarion call, and opportunity, to change the way we eat, live, grow, build and power our lives to achieve a carbon-neutral, 'nature-positive' economy and halt biodiversity loss by 2030. Business as usual is no longer an option.
The report highlights the need for a fundamental transformation across three socio-economic systems, which represent over a third of the global economy and provide up to two-thirds of all jobs. These systems are: food, land and ocean use; infrastructure and the built environment; and extractives and energy. Together they drive the threats which endanger almost 80% of the total threatened and near-threatened species. These systems, therefore, have a significant opportunity and responsibility to reverse nature loss. But they also have tremendous upside benefits to gain by embracing this transformation now.
Source: World Economic Forum
Financial Perils in Check for Now, Eyes Turn to Risk of Market Correction
January 27, 2021--"The vaccines are here!"-the cry heard and welcomed the world over-has boosted hopes of a global economic recovery in 2021. Yet until vaccines are widely available, the market rally and the economic recovery rest on continued monetary and fiscal policy support.
Financial stability risks have been in check so far, but we cannot take this for granted.
Prices for stocks, corporate bonds, and other risk assets have risen higher on the news of vaccine rollouts. Financial markets have shrugged off rising COVID-19 cases, betting that continued policy support will offset any bad economic news in the short term and provide a bridge to the future. As the apparent disconnect between exuberant financial markets and the still-lagging economic recovery persists, it raises the specter of a possible market correction should investors reassess the economic outlook or the extent and duration of policy backstop.
Source: IMF
World Economic Outlook Update-January 2021-Policy Support and Vaccines Expected to Lift Activity
January 26, 2021--In just three months since we released our last forecast in October, recorded COVID-19 deaths have doubled to over 2 million, as new waves have lifted infections past previous peaks in many countries.
In these same three months, multiple vaccines have seen unexpectedly strong success and some countries have started ambitious vaccination drives. Much now depends on the outcome of this race between a mutating virus and vaccines to end the pandemic, and on the ability of policies to provide effective support until that happens. There remains tremendous uncertainty and prospects vary greatly across countries.
In our latest World Economic Outlook forecast we project global growth for 2021 at 5.5 percent, 0.3 percentage point higher than our October forecast, moderating to 4.2 percent in 2022. The upgrade for 2021 reflects the positive effects of the onset of vaccinations in some countries, additional policy support at the end of 2020 in economies such as the United States and Japan and an expected increase in contact-intensive activities as the health crisis wanes. However, the positive effects are partially offset by a somewhat worse outlook for the very near term as measures to contain the spread of the virus dampen activity.
Source: IMF
Measuring Stakeholder Capitalism: Towards Common Metrics and Consistent Reporting of Sustainable Value Creation
January 26, 2021--This report identifies a set of Stakeholder Capitalism Metrics, drawn from existing voluntary standards to offer comparable metrics and disclosures across 4 pillars that are considered most critical for business, society and the planet.
Our aim is to catalyze the convergence, simplification and standardization of the non-financial reporting ecosystem.
Source: World Economic Forum
BlackRock pushes companies to adopt 2050 net-zero emissions goal
January 26, 2021--World's largest asset manager considers dumping companies that fail to meet targets
BlackRock, the world's largest asset manager, will push companies to commit to achieving net-zero emissions by 2050 and raised the prospect of dumping companies that fail to do so from its actively-managed funds.
In a pair of letters sent on Tuesday to chief executives and to BlackRock's clients, chief executive Larry Fink said that a "tectonic shift" in the investment landscape was happening faster than he expected.,
Source: irishtimes.com
Connecting Countries and Cities for Regional Value Chain Integration: Operationalizing the AfCFTA
January 25, 2021--On 1 January 2021, the African Union launched the African Continental Free Trade Area (AfCFTA). This Regional Action Group for Africa report is part of a series investigating five priority pathways to drive economic recovery and build resilience in the context of the AfCFTA Agreement.
It explores two priorities: first, unlocking manufacturing to mitigate global supply-chain risks; and second, leveraging integration and regional value chains. It also reviews intra-African trade and current African efforts to liberalize trade in the continent, examining how to unlock production capacity to meet local and global demands in strategic sectors, focusing on the automotive industry.
Source: World Economic Forum
World Economic Forum-Chief Economists Outlook 2021
January 25, 2021--The approval of several COVID-19 vaccines in late 2020 has brightened public health and economic prospects for 2021. Yet, prior to the onset of the pandemic, the global economy already had a fragile growth outlook, with social tensions over the evident polarization of economic outcomes and high levels of uncertainty.
At this critical juncture, policymakers need to look beyond reviving the old economy and instead shift towards a thriving global economy-where growth is revived, social justice more fully realized, and the climate crisis averted.
Based on consultations and surveys with the World Economic Forum's Community of Chief Economists, this edition of the quarterly Chief Economists Outlook lays out the key drivers shaping the current context, the policy pathways that could shape the global economy this year, and the resulting expected outlook for 2021.
Source: World Economic Forum
ETFGI reports assets invested in ESG ETFs and ETPs listed globally reach a new milestone of 187 billion US dollars at end of 2020
January 22, 2021--ETFGI, a leading independent research and consultancy firm covering trends in the global ETFs and ETPs ecosystem, reported today that assets invested in ESG (Environmental, Social, and Governance) ETFs and ETPs reached a new milestone of US$187 billion at the end of 2020. Assets invested in ESG ETFs and ETPs increased by 206% in 2020.
During December ESG ETFs and ETPs gathered net inflows of US$18.46 billion during, bringing 2020 net inflows to US$88.95 billion which significantly greater than the US$27.79 billion gathered in 2019, according to ETFGI’s December 2020 ETF and ETP ESG industry landscape insights report, the monthly report which is part of an annual paid-for research subscription service. (All dollar values in USD unless otherwise noted.)
Highlights
Assets invested in ESG ETFs and ETPs listed globally reached a new milestone of $187 billion.
Assets invested in ESG ETFs and ETPs increased 206% in 2020.
2020 net inflows are a record $88.95 billion which is significantly greater than the $27.79 billion gathered in 2019.
Source: ETFGI
