In interviews with sovereign wealth funds, pension corporations and asset managers in Asia and Europe that jointly manage around $3. 4 trillion, one thing is clear: many of them prevent stock market overheating.
The maximum attitude is not unusual caution. They are aware that the uptick in markets and valuations of personal companies is largely due to incredibly low interest rates, large central bank stimuli and government tax support, some of which would possibly begin to decline in the coming months.
With asset values still inflated, even in some hot spaces such as fitness care and technology, many expect a possible momentary slowdown after stimulus measures are completed, but before mass vaccinations allow economies to restart without risking widespread infection.
Here’s what they had to say:
Convenience Stores, Pipelines
GIC Pte, Singapore’s sovereign fund, is in the “least beloved” spaces of retail to infrastructure, whose valuations have been crushed by the pandemic, chief executive Lim Chow Kiat said when the company published its annual report last July.
The fund officially reveals that it manages more than $100 billion, but has more than $450 billion, according to the Sovereign Wealth Fund Institute, making it the sixth largest in the world.
In two of its biggest deals this year, it’s part of an organization that acquired a 49% stake in ADNOC Gas Pipelines for $ 10. 1 billion, and last month partnered with Australian real estate organization Charter Hall on a acquisition of $ 682 million ($ 500 million). of two hundred convenience outlets attached to service stations.
Investment director Jeffrey Jaensubhakij says even spaces like hospitality can recover before global selections increase. “Once the virus has been contained, the national can go back even if the foreigner can’t,” he said.
Supply chain change
Global border closures can only be transient and the industry is slowly recovering, says Didier Borowski, director of global outlook at Amundi SA, Europe’s largest asset manager, which oversees the investment of around $1. 9 trillion.
However, he predicts that the pharmaceutical and fitness industries will shift production of certain key products to a country,but even then, Borowski says it would be too expensive and uneconomic to bring everything home.
“This is the end of rampant globalization, the end of globalization,” he said in a previous interview earlier this month.
Staycations
With restrictions restricting vacation plans, so-called stays are back on the agenda, says Will James, deputy head of European equities at Standard Life Aberdeen Plc, whose team manages the equivalent of roughly $ 11 billion.
He invested in Thule Group AB, the Swedish manufacturer of bike racks and car racks, whose stock has almost doubled since the end of March.
“Instead of going to the beach abroad, other people stay home to drive around the country,” he said in an overdue interview last month.
Aeronautical movements like Airbus SE can simply “recover very aggressively” if a vaccine is found, however, it warns that it is not yet clear whether the world will ever be the way it was again, even if it works.
Bonds, bonds
Bonds are one of the great un beloved assets of the Covid crisis, says Andrew McCaffery, CIO of Fidelity International, which manages about $437 billion.
Car manufacturers’ bonds are especially hot as car production selections increase and more people drive to congested public transportation, he said in a previous interview earlier this month.
“If you look at credit spreads, they have reached degrees that make the bonds of some global automakers relatively attractive,” he said, and mentioned Ford Motor Co. and Nissan Motor Co. as examples. ” These obligations are not appreciated, especially when it is said that there has been an increase in car use compared to public transport. “
Green bounce
When the pandemic was sold and recovered, AustralianSuper, the country’s largest pension fund with the equivalent of about $133 billion, retained more than part of its Australian and global stock portfolio and reduced its genuine equity, credits and holdings of personal equity.
He is now looking for investments in digital, maritime and social infrastructure as governments make the most of economies, data chief Mark Delaney said last week. Millions agree with Quinbrook Infrastructure Partners, as governments, a green bounce.
“It is transparent that doing more in the surrounding domain will be a great long-term result,” he said.
Holding the fire
With a mandate to maximize long-term returns, the Australian sovereign fund keeps its dust dry, CHIEF Raphael Arndt said in the annual update of the previous portfolio earlier month. “Unless opportunities arise,” he said.
“Economies around the world are at their worst recessions in many decades, and if you look at asset prices, they haven’t moved much,” he said. “The question investors want to ask themselves is: it only makes sense if interest rates remain very close to 0 and the stimulus remains for a long, long time, and there will have to be risks. That’s why we’re in a much bigger position cautiously right now. “
Data centers
Because public procurement is overrated, Aware Damian Graham’s Super CIO embarks on direct investments, such as knowledge centers and apartment buildings. The $91 billion fund is also promoting some of the assets it claims will harm, such as buildings and grocery malls, among others. people replace the way they paint and shop, he said in an interview last month.
The Sydney-based fund invested a hundred million euros ($118 million) last week with APG Group NV to build hotel apartments in Europe, an agreement that could amount to 500 million euros. It is also a bidding war for the OptiComm fiber optic operator. Limited.
China’s technology
While China is the first to be affected by the coronavirus, it is now leading the way, making it an exciting proposition for Singapore’s state investor Temasek Holdings Pte.
The company, which oversees approximately $225 billion, is positive on several key issues in China, adding technology for customers, life sciences, biotechnology and fintech, said leading investment strata Rohit Sipahimalan in the company’s annual review earlier month.
“This year, China is most likely the only primary economy to revel in positive GDP growth,” he said.
This story was published from a firm thread without converting the text. Only the name has been changed.
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