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Evaluating the Effects of China’s Pork Crisis
African swine fever is ravaging China’s pork supply and having a global impact on protein prices. For equity investors, the crisis serves as a reminder that even amid trade-war uncertainty, research into domestic trends can help investors access the country’s vast stock market. China is a pork-loving nation that produces and consumes about half the world’s pig meat. That’s why
Market Reaction to Tariffs Misses Larger Opportunity in Asia
The latest tariffs in the U.S.-China trade dispute may be giving investors a second bite of the cherry! The U.S. government hiked the tariff on US$200 billion of Chinese exports to 25% from 10%. In response, China raised tariffs on nearly US$60 billion of U.S. goods to as high as 25% from around 10%. The expansion of tariffs is of
Emerging Markets: Widen Your Lens Beyond Trade Tensions
Emerging markets were up pretty sharply through the beginning of May: about 13% for equities, almost 7% for debt. Part of that was because of this consensus that developed that the US and China would reach some agreement on trade and there might be some historic handshake that would resolve their differences. On May 5th, President Trump tweeted his intention
The Global Consequences of a Sino-American Cold War
What started as a trade war between the United States and China is quickly escalating into a death match for global economic, technological, and military dominance. If the two countries' leaders cannot manage the defining relationship of the twenty-first century responsibly, the entire world will bear the costs of their failure. NEW YORK – A few years ago, as part
Why Volatility Could Be Worse
Russ discusses why volatility has not been more severe, even though growth has softened. With one Sunday afternoon tweet, President Trump reintroduced what had recently vanished from financial markets: volatility. By Thursday May 9th, the VIX Index, which measures implied volatility on the S&P 500, had reached a four-month high. With a trade deal with China now in doubt, or
European Banks—Choosing the Right Layer of the Capital Structure
European Banks have mostly been magnets for bad news and disappointment for their equity holders. But we believe other parts of the banks’ capital structure offer solid returns, backed by resilient balance sheets. The Problem? Poor Profitability, Not Weak Balance Sheets European banks have been struggling to improve profitability in a persistently tough environment. Continuous low rates, a flat yield
Why Play Defense in Rising Emerging Markets?
Why should emerging-market investors exercise caution in a rising market? With big unresolved challenges, we think it’s prudent to target companies with solid fundamentals and stable business models to overcome macroeconomic uncertainty and build a resilient portfolio for the long-term. Emerging-market stocks have bounced back in 2019. After dropping more than 14% in 2018, the MSCI Emerging Markets Index was
Measuring Inflation, Celebrating Job Creation, and Watching Chinese Debt
SUMMARY Why Is Inflation So Low? The Incredible American Job Machine China’s Bad Loans Are Getting Worse According to Oscar Wilde, cynics are people who know the price of everything and the value of nothing. On a related note, I am beginning to suspect economists are people who know nothing about prices. Trends in the price level have confounded analysts
Global Growth Themes and Forecasts (Infographic)
© Loomis, Sayles & Co. This article was originally published in Advisor Perspectives. Photo: iStock
Stop Worrying about Your Portfolio
EXECUTIVE SUMMARY Investors have a tendency to focus on the characteristics of their portfolios almost to the exclusion of other factors that will lead to success or failure for the larger objective that the portfolio is intended to serve. By taking into account the characteristics of the assets and liabilities that exist outside of their investment portfolios, they could build