October started strongly but ended weakly as Covid concerns rose again.
"After all, it is difficult to determine which election outcome the market had priced in, when and with what probability. "
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Posts From DWS
Strong S&P 500 EPS Results for the Third Quarter
Strong S&P 500 EPS Results for the Third Quarter, Probably the Best of the Year CIO | View – Americas CIO View Powerful direct fiscal assistance to small businesses and households, forbearance programs, business reopening's and warmer weather all helped
The future of office spaces
Contrary to common fears, Covid-19’s long-term effect on office demand might actually be accretive, or at least not destructive. Many observers have claimed that the pandemic has revealed city-center offices to be relics of the 20th century. We take a
CIO View – Investment Traffic Lights
MARKET OVERVIEW In August, investors were risk-on and helped the stock markets in particular to some new record highs. The economic recovery continues to progress but is losing some of its momentum. From a strategic point of view we see
DWS Long View – Q2 2020 update
Within this report, we present the DWS long term capital market assumptions1 as of the end of June 2020 for major asset classes. Back in April we published a report analyzing the impact of the COVID-19 pandemic on long-term return
No Recovery Yet
Crude continues to oscillate, as the pace of economic recovery and uncertainty over lifting or re-imposing lockdowns drive market sentiment. A weaker U.S. dollar, negative real interest rates and uncertainty amid the coronavirus pandemic are propelling gold prices. We expect
Covid-19 And The Internet Of Things
Conventional wisdom has it that Covid-19 will speed up familiar trends, such as those toward automation and digitization. A closer look at one of the supposed beneficiaries, the Internet of Things, suggests a more nuanced picture. The ultimate outcome may
Big Numbers Alone Make No Proper Monetary Policy
Aggressive interest rate cuts, liquidity provisions and quantitative easing worked well. Buying facilities rather serve as a backstop. Based on a diminishing marginal effect from Large Scale Asset Purchases (LSAP), the Fed might do more for longer to support
How a virus may speed up the energy transition
What the last few months taught us about winners, losers and survivors in European electricity markets. The Covid-19 pandemic already looks set to cause the biggest drop in global energy demand in modern history in 2020. Especially in Europe, the
Passive Investing 2020 – Addressing climate change in investment portfolios
This 2020 global survey is part of an annual research programme by DWS and CREATEResearch. It is designed to highlight the forward trends in passive investing. This year’s survey looks at how pension investors are using passive funds to deal
Almost back to normal
The world is going through its most severe recession since the Second World War. Unemployment and short-time working1 are at record levels in many countries, rating agencies are lowering their ratings at record …
Optimism Overdone
We are cautious about the oil price after its rapid recovery. A weaker dollar, low real interest rates and higher inflation expectations are likely to support gold. We reaffirm our belief that China will meet the requirements of the phase-one
At a turning point
Five months into the Covid pandemic, there are signs of improvements. The risk of setbacks remains high, however. Globally, infection rates remain worryingly high. In developed markets, a resurgence in outbreaks appears likely. Despite recent progress in containing Covid-19, the
Back to normal. But what is normal?
The record market slide has been followed by record-breaking stimulus – and a superfast rally. The economy is yet to follow. Coronavirus and its repercussions continue to dominate people's lives, the economy and stock markets. The calming in continental Europe's
Green, healthy buildings as economic stimulus
EU policy recommendations on starting a paradigm shift We welcome the EU’s intention to ‘Rebuild Europe’ by accelerating gren building renovation1 to support economic recovery, to support our health2 , to reduce carbon emissions and improve energy security.
Layers of Uncertainty
US Economic Outlook As an economist one has to live with uncertainty. Perhaps, that is why many economists have fallen in love with statistics and mathematics, as they promise at least some clarity. And, depending …
Ready or not, normal here we come: but hard to find for many
Americas CIO View The severe economic damage of widespread non-essential activity lockdowns to U.S. and European economies is moving behind, but we expect a slow recovery with elevated …
Post the Oil-Price Inflection
CIO Commodity Commentary Oil is again trading near its five-week high, with a West Texas Intermediate (WTI) price of around 29.5 dollars per barrel – a bit higher than half its end-February level. After April's rollercoaster …
DWS Long View: The impact of COVID-19 pandemic on long-term return forecasts
Entering 2020, the long-run return forecasts across asset classes left something to be desired. The rich valuations meant that investors could only expect low returns from most asset classes going forward. A lot has changed with the …
A downturn unlike any other?
Quarterly CIO View Around the globe, the rapidly spreading Coronavirus has created unprecedented political, public-health and economic crises. Not that you would necessarily know, if you had fallen asleep in mid-February and were only now checking …
COVID-19 and the financial markets Spotlight: Fixed Income
While the numbers of new infections and related fatalities are growing with slowing momentum, the discussion around the pace and scope of easing lockdowns becomes increasingly heated. Latest GDP figures and rising unemployment rates are among other figures fueling the
Living in history: how will we look back at this moment?
Pandemic 2020: a passing moment or a new era that shapes our future? New cycles tend to bring new trends, themes and investment leadership. First-quarter earnings season and preliminary economic reports confirm recession. David Bianco Prevention measures will shift to
ETF Trading in Volatile Times
Investment Insights The ongoing market volatility caused by the COVID-19 pandemic has resulted in record trading volumes against a backdrop of reduced liquidity in all asset classes. Exchange Traded Funds (ETFs) have so far, and once again, proven their resilience
Corona and TALF 2.0
The Fed has expanded the Term Asset-Backed Securities Loan Facility (TALF) in an effort to improve financing for households and small businesses. Liquidity has improved dramatically for TALF-eligible assets now that both dealers and investors know the downside is relatively
Oil Goes Sub-Zero
Perhaps, it is a sign of the times we live in. Over the past decade, investors have had to get used to the idea of nominal interest rates falling below zero – something economists once thought would be impossible. Could
April 2020 Fixed Income Update
COVID-19 and the financial markets Spotlight: Fixed Income Various central bank measures and rescue packages have lifted the sentiment on the global capital market in the last days. While the curve of new infections and fatalities is flattening in many
Normative judgments
How assessing norm violations in a portfolio context could help avoid risks. The most prominent norm violations typically relate to breaches in human rights, environmental responsibility and business ethics. The sectors most prone to norm violations are energy, consumer staples
Governments And Central Banks, Helping Largely
The stimulus measures being passed in response to the coronavirus pandemic are unprecedented. However, a recession seems inevitable. Who will ultimately have to bear the costs? The scale and pace of fiscal- and monetary-stimulus measures to support the economy are
2020 – coronavirus reversal and rebound
Covid-19 is the paramount issue. We expect a sharp economic slowdown in the first half of 2020, followed by a subdued rebound. The coronavirus is likely to slow down the economy in unprecedented ways. Nonetheless, we expect the epidemic to
Cutting to crisis forecasts: 2020e SP500 EPS 125 dollars
An economic crisis of uncertain severity: cut s&p 500 2020 end target to 2750an economic crisis of uncertain severity: cut s&p 500 2020 end target to 2750 We expect a state of emergency in the United States and most of
COVID-19 and the financial markets Spotlight: Fixed Income
Last week’s financial market headlines were dominated by superlatives and historical comparisons. Volatility figures, spread and index levels which have not been seen since the financial crisis (if ever) appeared on the screens. In order to keep you informed on
RESPONSES TO THE PANDEMIC
The spread of the novel coronavirus continues to cause immense uncertainty. A growing number of European countries have imposed curfews, effectively putting whole nations under lockdown. So has California, ordering 40 million people to stay indoors. The most likely area
Commodity-Market Turmoil
The gold price has been falling but a supportive rates environment and safe-haven demand brighten our outlook. The Saudi-Russian oil-price war broke out at the worst possible time. Any further negotiations are likely to involve a new kid on the
Covid-19 Prevention: An Unprecedented Global Economic Shock
CIO | View Prioritizing prevention over production: expect a sharp but brief recession Many cities and institutions around the world are putting prevention over production. They are curtailing large group activities through March or longer to contain the virus. Local
Viral uncertainty
In light of the very dynamic market environment these forecasts are subject to change at any time.
Long View
Forecasted returns and other considerations The world has been trying to find a new economic identity ever since the 2008 financial crisis. The journey has been arduous so far, with the scars of the financial crisis still quite raw. As
We are tactically taking some risk out of our portfolios
The MSCI AC World Index rose by a miserable 0.01% in January. The virtual standstill might seem to sug- gest that nothing much happened. So we might as well go straight to the outlook section then, right? Well, not so
Adjusting Our Strategic Cio View Forecasts
The rapid spread of the new coronavirus and the oil-price war have prompted us to revise the 12-month forecasts formulated in mid-February. In particular, we reduced the growth-rate forecasts for the United States and Europe and adjusted the yield and
ECB standard package on a historical day
CIO | View Amid severe market collapses, dramatic corona measures and energetic central banks in the UK and United States, the ECB package was somewhat underwhelming. Even on a "normal" trading day in times of the coronavirus crisis, the package
USD Fixed Income looks attractive from a carry perspective
Update: Yield-Duration Heatmap – 09/03/20 vs. 02/03/20
COVID-19 and the financial markets
Spotlight: Fixed Income While the virus was the dominating theme in politics, economics, sports, daily life and border management (just to name a few) the financial markets have reacted with another strong sell-off across asset classes last week. This document
Oil-Price Shock Adds To Corona Worries
While new infections of the novel coronavirus in China and South Korea have declined noticeably, the sharp increase in Italy has led to drastic measures by state authorities. At the same time, the situation in the oil market came to
Chart of the Week
THAT SINKING FEELING The U.S. Federal Reserve (Fed) unexpectedly cut interest rates by 50 basis points to a new target range of 1.00% to 1.25% on Tuesday, March 3. But U.S. yields have been falling for some time already, as
The dawn of a new decade
Forecasted returns and other considerations The world has been trying to find a new economic identity ever since the 2008 financial crisis. The journey has been arduous so far, with the scars of the financial crisis still quite raw. As
A Justified Correction: Opportunities Exist, but Risks remain
For the last several months, we have been tactically cautious on equities; especially non-financial value stocks. We were surprised by the speed of the S&P 500's rally to a record high of 3386 on February 19. Our primary concern was
Fingers Crossed for the Service Providers
Chart of the week Up until now, the service sector has proven to be a pacesetter for the entire economy. However, the new coronavirus is threatening to slow down its pace. The economy has been advancing at two speeds for
Investment Traffic Lights
Our Monthly Market Analysis and Positioning The investment traffic lights review the past month and preview the next one. But at this point, at the beginning of a new decade, it is timely to consider not just December, but also
Coronavirus turmoil is overshadowing commodities
Commodities and the energy space in particular have been challenged by the coronavirus outbreak. How the infection rate evolves over the upcoming days and weeks will be critical, especially to the oil-price outlook. Chinese copper importers have declared force majeure.
How European insurance regulators are responding to climate risk
Efforts to measure, stress test and manage climate risks among insurers are accelerating A report from the UN Environment Inquiry into a Sustainable Financial System 2 concluded that “In its role as risk manager, risk carrier and investor, insurance is
S&P 500 sector composition: more tech, less energy than ever before
The S&P 500 remains a broad equity index, but its sector mix has changed As the S&P 500 sets new record highs this month – led by tech reaching new highs, while energy revisits 2016 lows – we decided to reexamine
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