MeDirect Bank launches commission-free campaign on securities purchased throughout April

MeDirect Bank Malta has launched a “Buy Commission-Free” campaign whereby clients are not charged any brokerage fees when purchasing securities available through the MeDirect Bank’s mobile app, eBanking platform and in person, through its investment centres. The campaign is valid for the whole month of April.

Customers can choose their preferred investment from a huge selection of over 4,300 securities, including equities listed on 17 international stock exchanges, several ETFs and Mutual Funds managed by international and leading fund houses, together with a selection of local and international bonds.

Adrian Vella, Head of MeDirect’s Investment Network said: “We wanted to give our existing and future customers an opportunity to experience our superior online investment capabilities by being able to invest at zero commissions without having to compromise on quality and service.”

The Buy Commission-Free offer includes mutual fund buy orders submitted by 30 April as well as equity, ETF and bond buy orders executed until 30 April. Buy orders executed after the end of the promotion, will incur the fees stipulated in the tariffs and charges document, which is available on the MeDirect Malta website. Stock exchange transaction fees, taxes on stock exchange transactions and other third-party costs will continue to apply, alongside the current fees for sell transactions. Terms and conditions apply and can be found here.

MeDirect Bank Malta is the island’s First Digital Bank and offers its clients access to market-leading financial products. Earlier this year, MeDirect Bank Malta launched trading services through its mobile app which allows users to invest real-time whilst on the move from anywhere. The MeDirect mobile app enables clients to have an all-in-one banking solution which gives clients full control of their finances from one single platform, allowing them to monitor and manage their day-to-day finances, savings and investments.

If one is not a client of MeDirect, they can be guided online on how to open an account with the bank and be able to benefit from this offer by clicking here. For further information clients may contact us on 25574400.

Promotional offer is for a limited time only. Terms & conditions apply.

MeDirect Bank (Malta) plc, company registration number C34125, is licensed to undertake the business of banking in terms of the Banking Act (Cap. 371) and investment services under the Investment Services Act (Cap. 370).

 

Notes from the Trading Desk – Franklin Templeton

Franklin Templeton’s Notes from the Trading Desk offers a weekly overview of what our professional traders and analysts are watching in the markets. The European desk is manned by eight professionals based in Edinburgh, Scotland, with an average of 15 years of experience whose job it is to monitor the markets around the world. Their views are theirs alone and are not intended to be construed as investment advice.

The Digest

Global equities were higher overall last week, with existing themes providing some push and pull. Central bank hawkishness, persistent inflationary pressures and the war in Ukraine are all existing themes which investors are still trying to digest. Despite the uncertainty, the MSCI World Index closed the week up 1.3%, while regionally, performance was fairly mixed, as the S&P 500 Index closed the week up 1.8%, the STOXX Europe 600 Index closed down 0.2%, whilst the MSCI Asia Pacific closed up 0.5%. This week marks the end of the first quarter, and it has been a very eventful quarter for markets. Through the quarter, the S&P 500 Index has traded within a 14% range of its year-to-date (YTD) highs; the STOXX Europe 600 Index trading range has been 18%; whilst the MSCI Asia Pacific Index has traded down as much as 16% from its highs.

Ukraine Crisis Continues

There was little change in our key market themes last week; however, it is clear that the market remains poised for some more positive headlines out of Ukraine. It has now been over four weeks since Russia launched its invasion of Ukraine, and there are very few signs that the conflict will be coming to an end soon. But, it still feels like hope is a big driving factor behind relative equity market strength despite the clear headwinds.  Headlines throughout last week suggested that the two sides remain far apart in negotiations. Ukraine’s Deputy Chief of Staff Ihor Zhovkva said that the Donbas and Crimea territories are non-negotiable, and the country would never surrender them. The Kremlin also advised that there was no progress on the key issues. Questions about Russia’s intentions in Ukraine were raised again last week, with reports that Russia will focus (for now) on taking full control of the Donbas region. This appeared to show a scaling back of the ambitions of Putin. Earlier in the week, US President Joe Biden said that he believed Russia’s President Putin’s back was against the wall, increasing the chances of the use of chemical or biological weapons.

Yet, despite the continued violence and the lingering uncertainty for the global economy, equity markets are now approximately 5% above pre-invasion levels. Positioning had been extreme so far this year, and this positioning was occurring well before Russia’s invasion of Ukraine. We saw significant rotation in January, with some broad risk-off moves as investors moved out of growth and into value. So, sentiment was already bearish, and the invasion exacerbated this trend. Despite the technical reasons for a bounce in equity markets, the same headwinds still persist. Investors should be wary of more hawkish central bank rhetoric, as commodity prices rose again last week and the true extent of the impact on the global supply chain is yet to be felt.

So, what next? We could see a challenging second-quarter ahead, particularly in Europe. Sentiment has fallen to levels seen during other crisis periods, and inflation will likely stay elevated amid global supply-chain disruptions.

Week in Review

Europe

Last week, European equities actually finished one of the least-volatile weeks YTD, down 0.2% overall, following a late selloff. Equity markets had been fairly resilient all week in the face of continued headwinds. Yet, stock markets were fairly stable, with TINA (“There Is No Alternative”) apparently back in play. Intra-day volatility was lower again. European equities have now recovered more than half of their YTD losses and we saw risk appetite returning somewhat. Nonetheless, it was another week of outflows for European equity funds, although the pace of these outflows has been slowing. Market volumes have been poor, post the previous week’s expiries.

Sector performance divergence was large again last week Unsurprisingly, the YTD outperformers led the way again last week, namely basic resources and oil and gas stocks, tracking commodity prices. In terms of the laggards, construction and materials, travel and leisure, and retailing stocks all declined. Bond markets continued their YTD selloff, with investors taking note of the hawkish tones from central bankers throughout the week. Also, there was a comment from German Finance Minister Christian Lindner, who said we can no longer rely on the European Central Bank (ECB) to drive growth as it fights inflation.

Also, notably, the Russian market opened again to local investors last week, closing the week down 16% in US dollar terms. Foreigners (“non-residents”), who pre-crisis accounted for around 48% of all volumes traded on the Moscow Exchange are still banned from trading. There was also a ban on short selling. This means that trading is hugely skewed and unreliable (from a price discovery perspective), especially as it’s been well flagged that the Russian government has been an active buyer in both markets. Earlier in the week, the US White House slammed the reopening of the Moscow Exchange as a “charade,” saying it’s not a real market.

United States

Last week was a much quieter week for US equity markets, both in terms of trading volumes and headlines. The S&P 500 Index edged higher through the week, closing the week up 1.8%. Elsewhere, the Dow Jones was up 0.3%, the Nasdaq 100 Index up 2.3%, while the small cap Russell 2000 Index was down 0.4%. With the recent recovery in the S&P 500, the index is now just 5% away from all-time highs and sitting comfortably around its 200-day moving average, a key technical indicator.

Looking at sector performance, energy was a significant outperformer, gaining as West Texas Intermediate (WTI) crude oil traded up 10.5% following Yemen’s Houthi rebels’ attack on Saudi Arabian oil installations. Materials were also stronger amid higher commodity prices; the Bloomberg Commodity Index gained 5% last week. In terms of losers, health care was the only sector in negative territory.

One of the main talking points last week was Federal Reserve (Fed) policy, as Chair Jerome Powell stuck with a hawkish stance in comments earlier in the week. He stated his primary goal is to reduce inflation while preserving a strong labour market. He also noted the Fed will first remove the excess accommodation to move to a “neutral” rate stance but will shift to a “tight” stance if necessary. Importantly, when asked if anything would prevent a 50 basis-points (bps) hike at the next meeting, he answered “nothing.”

Following that, we saw some investment banks raise their interest-rate hike expectations. Fed fund futures now price in a 76.8% chance of a 50 bps hike in May, and futures markets now see eight 25 bps hikes this year. In this context, we have seen sharp moves in bond markets, with the US 10-year yield up 32.5 bps on the week, but notably up 14 bps last Friday alone. The US Treasury market has had its worst month since the election of President Donald Trump in 2016.

ASIA-Pacific

Last week was mixed in Asia, with new coronavirus cases, regional lockdowns, the ongoing accounting standards dispute between the United States and China, Japanese economic policy and of course the Ukraine-Russia war dominating headlines.

The MSCI Asia Pacific Index closed the week up slightly amid a strong showing from Japan, with strength in Japan as the Japanese Nikkei 225 Index closed the week up 4.93%, despite the market being closed last Monday.

The strong performance in Japan was mainly due to expectations of further economic stimulus and reassurances from the Bank of Japan (BoJ) that it will maintain its accommodative monetary policies. Last Wednesday, the market surged on reports of a stimulus package that sent the yen to six-year lows.

Japan’s Prime Minister Fumio Kishida is poised to order a package of measures as he seeks to address a deteriorating economic picture. Towards the end of the week, BoJ Governor Haruhiko Kuroda maintained his stance that a weaker yen is a plus for the Japanese economy, while recognizing some downside to the currency’s drop.

China’s mainland equity market closed lower last week as volatility continued amid heightened US-China tensions over Russia, risk of Chinese stocks being delisted in the United States and China’s new COVID-19 lockdowns. China’s government said last Tuesday that it will step up policy support for the economy and capital markets, reiterating earlier vows to shore up battered investor confidence in the face of weaker growth, a slump in property market and regulatory crackdowns on tech businesses.

Of note, the People’s Bank of China (PBoC) left the loan prime rate unchanged and trade in property developer Evergrande was suspended last Monday. China again denied sending military aid to Russia and repeated that it will help de-escalate tensions. However, it also noted its normal trade and economic relations with Russia, criticised sanctions on Russian oligarchs and said would not accept external coercion or pressure; so, mixed signals and actions continue. Last Wednesday, corporate developments lifted sentiment after online retailer Xiaomi followed Alibaba in making a buyback announcement, with some analysts thinking that Tencent could be next.

Surging COVID-19 cases continued to be a concern, with Shanghai reporting record new infections and China’s cabinet dispatching task forces to 10 provinces and municipalities, including Shanghai, to help oversee control. Chinese regulators continue to make efforts to avert delisting of Chinese stocks from US exchanges.

In Hong Kong, we saw a stronger start to the week, but that didn’t last, and the benchmark index there closed broadly flat, down 0.04%. Carrie Lam, the city’s leader, said she would lift a flight ban from nine countries starting 1 April, which will allow Hong Kong residents and travelers from countries including the United States and the United Kingdom to quarantine in a hotel for seven days, down from the current 14 days.

Macro Week Ahead Highlights

Monday 28 March:

  • The week starts with Bank of England (BoE) Governor Andrew Bailey scheduled to speak at a Bruegel event. Later in the day, UK Chancellor Rishi Sunak is due to appear before the Treasury Committee to discuss the Spring Statement.
  • US merchandise trade balance and wholesale inventories

Tuesday 29 March:

  • Germany consumer confidence
  • France consumer confidence
  • Spain retail sales
  • UK consumer credit

Wednesday 30 March:

  • BoE Deputy Governor Ben Broadbent speaks on ‘The MPC at 25’ at Niesr and the Money Macro and Finance Society.
  • Spain Consumer Price Inflation (CPI)
  • Italy industrial sales
  • Eurozone economic confidence
  • Germany CPI
  • US ADP employment
  • US gross domestic product and real consumption
  • Russia’s activity data for February (5pm) won’t capture much disruption from Putin’s invasion of Ukraine, which began 24 February. But weekly price data, due at the same time, will fill in the picture through March–expect inflation to spike to about 15% from 9.2% in the month prior.

Thursday 31 March:

  • UK GDP and current account (CA) balance
  • UK nationwide house price survey
  • France CPI and Producer Price Index (PPI)
  • Germany unemployment claims rate
  • Spain CA balance
  • Italy Harmonised Index of Consumer Prices (HICP) inflation
  • Italy unemployment rate
  • Eurozone unemployment rate
  • US jobless claims

Friday 1 April:

  • Eurozone CPI
  • US March employment report
  • US manufacturing – Institute of Supply Management

Franklin Templeton Key risks & Disclaimers:

What Are the Risks?

All investments involve risks, including the possible loss of principal. The value of investments can go down as well as up, and investors may not get back the full amount invested.  Stock prices fluctuate, sometimes rapidly and dramatically, due to factors affecting individual companies, particular industries or sectors, or general market conditions. Bond prices generally move in the opposite direction of interest rates. Thus, as prices of bonds in an investment portfolio adjust to a rise in interest rates, the value of the portfolio may decline. Investments in foreign securities involve special risks including currency fluctuations, economic instability and political developments. Investments in developing markets involve heightened risks related to the same factors, in addition to those associated with their relatively small size and lesser liquidity.

Any companies and/or case studies referenced herein are used solely for illustrative purposes; any investment may or may not be currently held by any portfolio advised by Franklin Templeton. The information provided is not a recommendation or individual investment advice for any particular security, strategy, or investment product and is not an indication of the trading intent of any Franklin Templeton managed portfolio.

Past performance is not an indicator or guarantee of future performance. There is no assurance that any estimate, forecast or projection will be realised.

This article reflects the analysis and opinions of Franklin Templeton’s European Trading Desk as of 28 March 2022, and may vary from the analysis and opinions of other investment teams, platforms, portfolio managers or strategies at Franklin Templeton. Because market and economic conditions are often subject to rapid change, the analysis and opinions provided may change without notice. An assessment of a particular country, market, region, security, investment or strategy is not intended as an investment recommendation, nor does it constitute investment advice. Statements of fact are from sources considered reliable, but no representation or warranty is made as to their completeness or accuracy. This article does not provide a complete analysis of every material fact regarding any country, region, market, industry or security. Nothing in this document may be relied upon as investment advice or an investment recommendation. The companies named herein are used solely for illustrative purposes; any investment may or may not be currently held by any portfolio advised by Franklin Templeton. Data from third-party sources may have been used in the preparation of this material and Franklin Templeton (“FT”) has not independently verified, validated or audited such data. FT accepts no liability whatsoever for any loss arising from use of this information and reliance upon the comments, opinions and analyses in the material is at the sole discretion of the user. Products, services and information may not be available in all jurisdictions and are offered by FT affiliates and/or their distributors as local laws and regulations permit. Please consult your own professional adviser for further information on availability of products and services in your jurisdiction.

Issued by Franklin Templeton Investment Management Limited (FTIML) Registered office: Cannon Place, 78 Cannon Street, London EC4N 6HL. FTIML is authorised and regulated by the Financial Conduct Authority.


MeDirect Disclaimers:

This information has been accurately reproduced, as received from Franklin Templeton Investment Management Limited (FTIML). No information has been omitted which would render the reproduced information inaccurate or misleading. This information is being distributed by MeDirect Bank (Malta) plc to its customers. The information contained in this document is for general information purposes only and is not intended to provide legal or other professional advice nor does it commit MeDirect Bank (Malta) plc to any obligation whatsoever. The information available in this document is not intended to be a suggestion, recommendation or solicitation to buy, hold or sell, any securities and is not guaranteed as to accuracy or completeness.

The financial instruments discussed in the document may not be suitable for all investors and investors must make their own informed decisions and seek their own advice regarding the appropriateness of investing in financial instruments or implementing strategies discussed herein.

If you invest in this product you may lose some or all of the money you invest. The value of your investment may go down as well as up. A commission or sales fee may be charged at the time of the initial purchase for an investment. Any income you get from this investment may go down as well as up. This product may be affected by changes in currency exchange rate movements thereby affecting your investment return therefrom. The performance figures quoted refer to the past and past performance is not a guarantee of future performance or a reliable guide to future performance. Any decision to invest in a mutual fund should always be based upon the details contained in the Prospectus and Key Investor Information Document (KIID), which may be obtained from MeDirect Bank (Malta) plc.

BlackRock Commentary: Energy shock, Fed spur new outlook

Wei Li, Global Chief Investment Strategist of the BlackRock Institute together with Alex Brazier, Deputy Head of he BlackRock Institute, Elga Bartsch, Head of Macro Research, Vivek Paul, Senior Portfolio Strategist and Scott Thiel, Chief Fixed Income Strategist all forming part of the BlackRock Investment Institute, share their insights on global economy, markets and geopolitics. Their views are theirs alone and are not intended to be construed as investment advice.

Key Points:

Outlook update – We now prefer U.S. and Japanese equities over European stocks due to the energy shock. We stay underweight bonds because of the inflationary backdrop.

Market backdrop – Bond yields sprinted higher last week, with U.S. 10 year Treasuries hitting near three year highs. Signs of weakening economic activity emerged in Europe.

Week ahead – U.S. inflation and jobs data this week could guide the Fed in its rate hike path. We believe it will deliver on its hawkish rate projection this year but then pause.

Much has changed since our 2022 outlook. The tragic war in Ukraine has resulted in a global energy shock. We see this increasing inflation, pressuring consumers and hurting growth, especially in Europe. The Fed has started to talk tough on inflation and has projected a large increase in rates. In our latest outlook update, we remain underweight bonds even as nominal yields have shot up this year, and reduce our European equities overweight in favor of U.S. and Japanese stocks.

Low real yields support equities

Energy shock, Fed spur new outlook Article Image 1

Russia’s invasion of Ukraine has taken a horrible human toll and has resulted in a spike in commodities prices that is driving food and energy insecurity. This is dampening economic growth and exacerbating supply-driven inflation, with Europe most exposed among developed markets (DMs) as it tries to wean itself off Russian energy. Rising inflation has kept real, or inflation-adjusted, yields near record lows, as the chart shows, even as nominal yields have sprinted upward. Central banks are scrambling to normalize policy and raise rates this year – but we don’t expect them to go quite as far in total hikes as markets currently expect. We expect long-term yields to edge up as investors demand more compensation for the risk of holding bonds amid high inflation. The result? We see more pain for bonds but believe stocks can thrive amid historically low real rates.

Markets respond to Ukraine war

Going into 2022, we nudged down portfolio risk as we saw a risk of markets pricing in aggressive central bank actions in an effort to contain inflation. This played out and pushed down both bonds and stocks – faster and harder than we expected. We added to our DM equities overweight at the expense of credit last month on a tactical horizon. Since then, three things have become clear to us: The commodities shock will make inflation even more persistent, the impact differs greatly by region, and central banks actually have made hawkish pivots in response.

Where does this leave our macro outlook?

We believe the Fed will go ahead with its projected rate increases for this year, but then will pause as the effect of tightening on growth becomes clearer. We expect that the Fed and other central banks eventually will be forced to live with supply-driven inflation, rather than take policy rates above their neutral level. Doing so would risk destroying growth and employment, in our view. As a result, we expect the sum total of rate hikes to be historically low given the level of inflation. Investors will start to question the perceived safety of government bonds, we believe, against this backdrop of high inflation and debt levels. What are risks to our base case? First, central banks could slam the brakes and cause a recession in an effort to contain inflation. Second, inflation expectations could become unanchored: Markets and consumers could lose faith that central banks can keep a lid on prices. This possibility makes the first risk more real.

All this means that we see more downside risk for government bonds – even as 10-year U.S. Treasury yields are hovering near three-year highs. DM government bonds are less effective portfolio diversifiers in periods when supply shocks dominate, as they do now. Within the asset class, we prefer short-maturity bonds over long-term ones. Markets have been quick to price in the Fed’s hawkish rate projections. We think this repricing in short-term rates is overdone as we don’t expect the Fed to fully deliver on its projected grand total of rate increases over the next two years.

We remain pro risk on a tactical horizon and prefer equities over credit. The inflationary environment favors stocks, in our view, and many DM companies have been able to pass on rising costs and keep margins high. We also like the combination of low real rates, the restart’s economic growth cushion and reasonable equity valuations. We reduce our overweight to European equities as we see the energy shock hitting that region hardest. Also, prices have rebounded from the year’s lows. Why not shift to an underweight? We expect the European Central Bank to only slowly normalize policy. We increase our overweight to Japanese stocks on prospects of higher dividends and buybacks, and supportive policy. We like the U.S. stock market as we see its quality factor resilient to a broad range of economic scenarios, brightening its appeal.

Market backdrop

Government bond yields climbed last week, with 10-year U.S. Treasuries hitting near three-year highs, before falling back on worries of economic weakness. Data showed the Ukraine war’s economic impact is starting to affect economic activity in the euro area. The U.S. economy for now looks resilient, and we prefer U.S. stocks over European ones as a result.

U.S. inflation and employment data may guide the U.S. Fed in the pace of raising rates after it delivered its first hike since 2018. We believe the Fed will deliver on projected rate increases this year but then pause. Inflation data won’t reflect the jump in energy and food prices resulting from the Ukraine war, we think. Jobs data are likely to show a post-Omicron boost.

Assets in Review

Energy shock, Fed spur new outlook Article Image 2

Energy shock, Fed spur new outlook Article Image 3

Week ahead

  • March 31 – U.S. consumption and PCE inflation; Czech Republic monetary policy meeting
  • April 1 – Euro area inflation; U.S. employment report

BlackRock’s Key risks & Disclaimers:

This material is not intended to be relied upon as a forecast, research or investment advice, and is not a recommendation, offer or solicitation to buy or sell any securities or to adopt any investment strategy. The opinions expressed are as of February 28th, 2022 and may change. The information and opinions are derived from proprietary and non-proprietary sources deemed by BlackRock to be reliable, are not necessarily all-inclusive and are not guaranteed as to accuracy. As such, no warranty of accuracy or reliability is given and no responsibility arising in any other way for errors and omissions (including responsibility to any person by reason of negligence) is accepted by BlackRock, its officers, employees or agents. This material may contain ’forward looking’ information that is not purely historical in nature. Such information may include, among other things, projections and forecasts. There is no guarantee that any forecasts made will come to pass. Reliance upon information in this material is at the sole discretion of the reader.

The information provided here is neither tax nor legal advice. Investors should speak to their tax professional for specific information regarding their tax situation. Investment involves risk including possible loss of principal. International investing involves risks, including risks related to foreign currency, limited liquidity, less government regulation, and the possibility of substantial volatility due to adverse political, economic or other developments. These risks are often heightened for investments in emerging/developing markets or smaller capital markets.

Issued by BlackRock Investment Management (UK) Limited, authorized and regulated by the Financial Conduct Authority. Registered office: 12 Throgmorton Avenue, London, EC2N 2DL.


MeDirect Disclaimers:

This information has been accurately reproduced, as received from  BlackRock Investment Management (UK) Limited. No information has been omitted which would render the reproduced information inaccurate or misleading. This information is being distributed by MeDirect Bank (Malta) plc to its customers. The information contained in this document is for general information purposes only and is not intended to provide legal or other professional advice nor does it commit MeDirect Bank (Malta) plc to any obligation whatsoever. The information available in this document is not intended to be a suggestion, recommendation or solicitation to buy, hold or sell, any securities and is not guaranteed as to accuracy or completeness.

The financial instruments discussed in the document may not be suitable for all investors and investors must make their own informed decisions and seek their own advice regarding the appropriateness of investing in financial instruments or implementing strategies discussed herein.

If you invest in this product you may lose some or all of the money you invest. The value of your investment may go down as well as up. A commission or sales fee may be charged at the time of the initial purchase for an investment. Any income you get from this investment may go down as well as up. This product may be affected by changes in currency exchange rate movements thereby affecting your investment return therefrom. The performance figures quoted refer to the past and past performance is not a guarantee of future performance or a reliable guide to future performance. Any decision to invest in a mutual fund should always be based upon the details contained in the Prospectus and Key Investor Information Document (KIID), which may be obtained from MeDirect Bank (Malta) plc.

Mercury Projects Finance p.l.c. – New Bond issue

Mercury Projects Finance p.l.c. (“Issuer”), is pleased to announce the issue of €50,000,000 Secured bonds at 4.3% at a nominal value of €100 per bond, redeemable in 2032 (the “Bond Issue”), following approval by the Listing Authority.

This bond issue will be subject to a minimum of €5,000, and will be issued at par. The interest rate of 4.3 per cent will be paid annually on 25th April, with the first interest payment date being 25th April 2023.

Full details about this Bond Issue are set out in the Prospectus dated 22nd March 2022 which can be found here.

MeDirect will be accepting applications from anyone, who is interested. All applications must be received by not later than 14th April 2023. In the event of over-subscription, the Issuer reserves the right to close the Offer Period before this date.

If you are interested in applying, please send us a Secure Mail or contact your Relationship Manager.

For further information, please call us on (+356) 2557 4400 or send an email to customerservice@medirect.com.mt.

 


The information set forth in this article is only for informative purposes and should not be construed as an offer to sell or solicitation of an offer to subscribe for or purchase any investment. The information provided is subject to change without notice and does not constitute investment advice or any guarantee of returns. Please consider the terms and conditions governing the relevant investment prior to making any investment decision. Investors should note that at worst they may lose all of their invested principal in the event of default, insolvency and/or bankruptcy of the relevant issue. The financial instruments discussed may not be suitable for all investors and investors must make their own informed decisions and seek their own advice regarding the appropriateness of investing in financial instruments or implementing strategies discussed herein.

MeDirect Bank (Malta) plc has based this document on information obtained from sources it believes to be reliable but which have not been independently verified. MeDirect Bank (Malta) plc does not therefore provide any guarantees, representations or warranties. The value of any investment or income may go up as well as down and past performance is no guarantee of any future performance. When an investment is denominated in a currency other than your local or reporting currency, changes in exchange rates may have an adverse effect on your investment.

MeDirect Bank (Malta) plc, company registration number C34125, is licensed by the Malta Financial Services Authority under the Banking Act (Cap. 371) and the Investment Services Act (Cap. 370). This material is intended only for the use of the recipient and shall not be reproduced in any way, whether in whole or in part, by the recipient. Any unauthorised disclosure, use or dissemination, either in whole or in part, of the material contained within is strictly prohibited.

IZI Finance p.l.c. – New Bond issue

IZI Finance plc (“Issuer”), has announced the issue of €30,000,000 Unsecured bonds at 4.25% at a nominal value of €100 per bond, redeemable in 2029 (the “Bond Issue”), following approval by the Listing Authority.

This bond issue will be subject to a minimum of €5,000, and will be issued at par. The interest rate of 4.25 per cent will be paid annually on 14th April, with the first interest payment date being 14th April 2023.

The proceeds from the Bond Issue, will be utilised by the Issuer for the following purposes, in the amounts and order of priority set out below:

  • an amount of approximately €16.2 million will be used to part finance the IZI Finance Group’s projected capital expenditure in connection with, and for the duration of the term of, the National Lottery Concession,
  • an amount of approximately €8.5 million will be used to finance the IZI Finance Group’s projected capital expenditure in connection with, and for the duration of the term of, the Dragonara Casino Concession,
  • an amount of approximately €3.9 million will be used to part finance the IZI Finance Group’s projected capital expenditure for the years 2022 to 2025 in connection with the IZI Finance Group’s retail gaming operations,
  • an amount of approximately €0.8 million will be used for general corporate funding purposes of the IZI Finance Group.

Full details about this Bond Issue are set out in the Prospectus dated 22nd March 2022 which can be found here.

MeDirect will be accepting applications from anyone, who is interested. All applications must be received by not later than 7th April 2023. In the event of over-subscription, the Issuer reserves the right to close the Offer Period before this date.

If you are interested in applying, please send us a Secure Mail or contact your Relationship Manager.

For further information, please call us on (+356) 2557 4400 or send an email to customerservice@medirect.com.mt.


The information set forth in this article is only for informative purposes and should not be construed as an offer to sell or solicitation of an offer to subscribe for or purchase any investment. The information provided is subject to change without notice and does not constitute investment advice or any guarantee of returns. Please consider the terms and conditions governing the relevant investment prior to making any investment decision. Investors should note that at worst they may lose all of their invested principal in the event of default, insolvency and/or bankruptcy of the relevant issue. The financial instruments discussed may not be suitable for all investors and investors must make their own informed decisions and seek their own advice regarding the appropriateness of investing in financial instruments or implementing strategies discussed herein.

MeDirect Bank (Malta) plc has based this document on information obtained from sources it believes to be reliable but which have not been independently verified. MeDirect Bank (Malta) plc does not therefore provide any guarantees, representations or warranties. The value of any investment or income may go up as well as down and past performance is no guarantee of any future performance. When an investment is denominated in a currency other than your local or reporting currency, changes in exchange rates may have an adverse effect on your investment.

MeDirect Bank (Malta) plc, company registration number C34125, is licensed by the Malta Financial Services Authority under the Banking Act (Cap. 371) and the Investment Services Act (Cap. 370). This material is intended only for the use of the recipient and shall not be reproduced in any way, whether in whole or in part, by the recipient. Any unauthorised disclosure, use or dissemination, either in whole or in part, of the material contained within is strictly prohibited.

BlackRock Commentary: Tough Fed talk on inflation, little bite

Jean Boivin, Head of the BlackRock Institute together with Wei Li, Global Chief Investment Strategist, Alex Brazier, Deputy Head of he BlackRock Institute and Nicholas Fawcett, Member of the Economic and Markets Research Team all forming part of the BlackRock Investment Institute, share their insights on global economy, markets and geopolitics. Their views are theirs alone and are not intended to be construed as investment advice.

Key Points:

Fed Rate Hikes – The Fed is talking tough on inflation by projecting a large and rapid increase in rates, but we think it won’t fully deliver and be forced to live with inflation. 

Market backdrop – The S&P 500 scored its biggest weekly gain since 2020, and bond yields rose. Chinese shares rebounded sharply after officials reassured a panicky market.

Week ahead – Economic data this week are likely to show a worsening in economic activity and consumer sentiment due to the Ukraine war and high inflation.

The Fed last week signaled a large and rapid increase in its policy rate over the next two years and struck a surprisingly hawkish tone, indicating it’s ready to go beyond normalizing to try to tame inflation. It’s easy to talk tough, and we believe the Fed is unlikely to fully deliver on its projected rate path. The reason? It would come at too high a cost to growth and employment. We do now see a higher risk of the Fed slamming the brakes on the economy as it may have talked itself into a corner. 

Tough Fed talk on inflation, little bite Article Image 1

The Federal Reserve has kicked off its hiking cycle with a quarter-point increase – the first since 2018. The decision was expected. What surprised was the Fed’s stated goal to get the fed funds rate to 2.8% by the end of 2023 (see the pink dots on the chart). This level is in the territory of destroying growth and employment, in our view. At the same time, the Fed’s latest economic projections pencil in persistently high inflation but low unemployment – even as it has called current labor conditions tight. We believe this means the Fed either doesn’t realize its rate path’s cost to employment or – more likely – that it shows its true intention: to live with inflation. We think this is necessary to keep unemployment low because inflation is primarily driven by supply constraints and high commodities prices.

BoE provides a glimpse ahead

The Bank of England (BoE), the first major developed market (DM) bank to kick off the current hiking cycle, increased its policy rate for the third time to 0.75%. Like the Fed, the BoE recognized additional inflation pressures from high energy and commodity prices. It also signaled that it may pause further rate increases, with rates back at pre-pandemic levels. We believe this means the BoE is willing to live with energy-driven inflation, recognizing that it’s very costly to bring it down.

The BoE provides a glimpse of what other DM central banks may do once they get back to pre-pandemic rate levels and the effect of rate rises on growth become apparent. The Fed’s tone may change as the consequences for growth become more apparent after aggressively hiking this year. The Fed last week perhaps wanted to appear tough by implying even more rate increases in future years to keep inflation expectations anchored, in our view, without expecting to deliver those hikes. To be sure: The Fed will normalize policy because the economy no longer needs pandemic-induced stimulus. It has also signaled it will start reducing its balance sheet, marking the start of quantitative tightening. Finally, we expect the Fed to raise the fed funds rate to around 2% this year – close to pre-pandemic neutral levels – and then pause to evaluate the effects.

What are the risks? Central banks are in a tough spot. First, they may start to believe some of their own rhetoric – and think they can raise rates well above neutral levels without damaging growth. They could hike too much, too fast as a result – and plunge economies into recession. We think this risk has risen since last week’s Fed meeting. Second, inflation expectations could de-anchor and spiral upward as markets and consumers lose faith that central banks can keep a lid on prices. This could force them to act aggressively amid persistently high inflation.

Our bottom line:

Last week’s central bank actions reinforce our views. We see more pain ahead for long-term government bonds even with the yield jump since the start of the year. We expect investors will demand more compensation for the risk of holding government bonds amid higher inflation. We stick with our underweight to nominal government bonds on both tactical and strategic horizons. We think the hawkish repricing in short-term rates is overdone and prefer short-maturity bonds over long-term ones. We prefer to take risk in equities over credit in the inflationary backdrop because we expect real – or inflation-adjusted – yields to stay historically low. We added to the DM equity overweight two weeks ago. We still like the overweight in this environment but see a differentiated regional impact from higher energy prices.

Market backdrop

Stocks rallied and government bond yields climbed last week after the Fed raised rates and Chinese policymakers soothed beaten-down Chinese markets. Chinese equities rebounded after officials suggested an end to the crackdown on tech companies and announced a relaxation of Covid restrictions to hit growth targets. We believe China’s ties to Russia have created a risk of geopolitical stigma, including potential sanctions.

Early survey data for March are likely to show a sharp worsening in sentiment because of the war in Ukraine and a spike in energy and other prices. We see the war weighing heavily on economic activity – especially in Europe – and pushing up inflation as higher energy prices pass through to consumer prices. We underweight nominal government bonds and prefer developed stocks in this inflationary backdrop.

Tough Fed talk on inflation, little bite Article Image 2

Tough Fed talk on inflation, little bite Article Image 3

Week ahead

March 22 – Hungary monetary policy meeting
March 23 – UK inflation
March 24 – Euro area, UK and U.S. flash PMIs
March 25 – U.S. University of Michigan sentiment

BlackRock’s Key risks & Disclaimers:

This material is not intended to be relied upon as a forecast, research or investment advice, and is not a recommendation, offer or solicitation to buy or sell any securities or to adopt any investment strategy. The opinions expressed are as of February 28th, 2022 and may change. The information and opinions are derived from proprietary and non-proprietary sources deemed by BlackRock to be reliable, are not necessarily all-inclusive and are not guaranteed as to accuracy. As such, no warranty of accuracy or reliability is given and no responsibility arising in any other way for errors and omissions (including responsibility to any person by reason of negligence) is accepted by BlackRock, its officers, employees or agents. This material may contain ’forward looking’ information that is not purely historical in nature. Such information may include, among other things, projections and forecasts. There is no guarantee that any forecasts made will come to pass. Reliance upon information in this material is at the sole discretion of the reader.

The information provided here is neither tax nor legal advice. Investors should speak to their tax professional for specific information regarding their tax situation. Investment involves risk including possible loss of principal. International investing involves risks, including risks related to foreign currency, limited liquidity, less government regulation, and the possibility of substantial volatility due to adverse political, economic or other developments. These risks are often heightened for investments in emerging/developing markets or smaller capital markets. 

Issued by BlackRock Investment Management (UK) Limited, authorized and regulated by the Financial Conduct Authority. Registered office: 12 Throgmorton Avenue, London, EC2N 2DL.


MeDirect Disclaimers:

This information has been accurately reproduced, as received from  BlackRock Investment Management (UK) Limited. No information has been omitted which would render the reproduced information inaccurate or misleading. This information is being distributed by MeDirect Bank (Malta) plc to its customers. The information contained in this document is for general information purposes only and is not intended to provide legal or other professional advice nor does it commit MeDirect Bank (Malta) plc to any obligation whatsoever. The information available in this document is not intended to be a suggestion, recommendation or solicitation to buy, hold or sell, any securities and is not guaranteed as to accuracy or completeness.

The financial instruments discussed in the document may not be suitable for all investors and investors must make their own informed decisions and seek their own advice regarding the appropriateness of investing in financial instruments or implementing strategies discussed herein.

If you invest in this product you may lose some or all of the money you invest. The value of your investment may go down as well as up. A commission or sales fee may be charged at the time of the initial purchase for an investment. Any income you get from this investment may go down as well as up. This product may be affected by changes in currency exchange rate movements thereby affecting your investment return therefrom. The performance figures quoted refer to the past and past performance is not a guarantee of future performance or a reliable guide to future performance. Any decision to invest in a mutual fund should always be based upon the details contained in the Prospectus and Key Investor Information Document (KIID), which may be obtained from MeDirect Bank (Malta) plc.

Notes from the Trading Desk – Franklin Templeton

Franklin Templeton’s Notes from the Trading Desk offers a weekly overview of what our professional traders and analysts are watching in the markets. The European desk is manned by eight professionals based in Edinburgh, Scotland, with an average of 15 years of experience whose job it is to monitor the markets around the world. Their views are theirs alone and are not intended to be construed as investment advice.

The Digest

More than anything else, hope led global equity markets higher last week. Headlines were very mixed as to when we would likely see an end to the war in Ukraine, with no progress of any great substance being made. The STOXX Europe 600 Index closed the week up 5.4%, the S&P 500 Index was up 6.1%, whilst the MSCI Asia Pacific Index was up 4.1%. The MSCI All Country Index rebounded to close up 5.7%, which is its biggest weekly gain since November 2020, when the success of the COVID-19 vaccines was first announced. Despite the overall strength last week, stock markets were really at the mercy of the headlines tied to Ukraine, which flip-flopped from one day to the next on the progress of peace talks. Outside of that, some clarity from the Federal Reserve (Fed), a dovish Bank of England (BoE), as well as some more supportive news flow out of Asia aided markets as the week went on.

Central Bank Announcements

Last week, investor focus shifted briefly onto central bank announcements. On Wednesday, the Fed raised interest rates by 25 basis points (bps) and signalled a faster pace of tightening. The “dot plot” chart of the Fed’s projections indicated a faster pace of rate hikes through 2023, shifting significantly higher in the near term—it is now indicating seven 25 bps hikes this year and another four in 2023. With regards to the possibility of a larger 50 bps rate hike, Fed Chair Jerome Powell indicated that if inflation fails to moderate as expected, then the Fed would be prepared to tighten more aggressively. The meeting statement, as well as Powell’s press conference, indicated that balance sheet reduction is likely to begin soon, with a possible announcement coming at the next meeting in May. Powell went on to say that plans are close to being finalised on that, increasing expectations for news at May’s policy meeting.

On Thursday, the BoE raised rates by 25 bps to 75 bps, as expected. The committee voted 8-1 in favour of the 25 bps rise, with the one dissenter voting to keep interest rates on hold. The dissenter, Jon Cunliffe, argued that Russia’s invasion of Ukraine could “increase uncertainty and decrease consumer and business confidence”. The release was viewed as slightly dovish as it also seemed to exclude a 50 bps hike in the near term. The market was braced for a possible 50 bps hike, or at least details or language suggesting one may be coming soon. With regards to events in Ukraine, the minutes stated that “there was little evidence available yet on the impact of the invasion (of Ukraine) on UK economic activity”. This will clearly be an area of focus for future central bank rhetoric in the months to come.

With regards to inflation per se, the minutes state that “further out, inflation was expected to fall back materially, and possibly to a greater extent than had been expected in the February report, as energy prices stopped rising and as the squeeze on real incomes and demand put significant downward pressure on domestically generated inflation”. With that, there is clearly still plenty of room for debate on the push and pull of inflation pressures through 2022.

Investors Hope for Russia/Ukraine Ceasefire

The market was hopeful all week that we may soon see an end to the war in Ukraine. The headlines didn’t quite reflect this sentiment, however, with seemingly very little progress being made by the end of the week. Earlier in the week, hopes were raised as Ukrainian President Volodymyr Zelenskyy stated that peace talks were starting to sound “more realistic, but time is still needed”. Zelenskyy also appeared to concede that Ukraine would not join NATO, one of Russia’s key demands. The Financial Times then reported on Wednesday that a 15-point plan had been drawn up to end the war. The report suggested that “significant progress” had been made with the plan, which included a ceasefire and Russia’s withdrawal if Ukraine declared neutrality and accepted limits on its armed forces. Markets ticked higher on this report. At the same time, oil prices dipped.

However, from then there were a flurry of articles suggesting that progress wasn’t as forthcoming as the article suggested. US Secretary of State Antony Blinken said there were no signs Putin was “prepared to stop” Russia’s invasion. Blinken said Russia’s military actions in Ukraine “are in total contrast to any serious diplomatic effort to end the war”. Also, Ukraine’s Deputy Chief of Staff Ihor Zhovkva said that negotiations had been progressing, but only slowly.

As it stands, around US$470 billion of the Central Bank of Russia’s (CBR’s) US$645 billion in reserves has been frozen. Recall, the bank did an emergency interest-rate hike at the end of February, from 9.5% to 20%, in response to Western sanctions in an attempt to reduce depreciation and inflation risks and support the ruble. On Friday, the CBR kept interest rates at 20%, as expected. Also, it was noted that Putin had asked CBR Governor Elvira Nabiullina to serve another five-year term. She is very well respected outside of Russia. Despite the CBR advising that the latest coupon payments of around US$117 million had been paid, ratings agencies are seeing the risk of default as increasingly likely. With foreign exchange reserves scarce, any default would see Russia’s cost of borrowing increase dramatically in coming years.

Nervousness in Europe

In terms of macro datapoints, it is worth noting that Russia’s invasion of Ukraine is depressing economic recovery hopes in Europe. The German ZEW survey plunged by 93.6 points to -39.3 from 54.3 in February. By comparison, at the beginning of the COVID-19 pandemic in March 2020, the indicator fell by 58.2 points. Other indicators within the survey had notable moves too. The assessment of the current macroeconomic situation worsened to -21.4 in March from -8.1 in February. At the same time, inflation expectations surged to 70.2 in March from -37.5 in February. The survey tends to be volatile, but it’s one to watch out for over the next couple of months.

Week in Review

Europe

European equities were broadly higher last week, with the STOXX Europe 600 Index closing the week up 5.4%. Sector divergence was wide once again in Europe, with some of the recent winners being sold and recent losers finding some relief. With that, financial services, technology and automobile stocks were up on the week. At the other end, we saw profit taking in basic resources and oil and gas stocks, which were both lower last week overall. European credit markets continued to tighten throughout the week and are now close to the levels at the beginning of February/start of March. Friday’s options expiries added liquidity and some volatility into stock markets to end the week. Despite overall market performance, it was another week of outflows for European equity funds.

Some interesting points from the monthly Bank of America Fund Managers Survey, which was released last week. The survey showed some significant shifts in the economic outlook for the region; perhaps not too surprising given recent events. However, it was the largest change in respondents’ outlook on record—a net 69% of respondents expect the European economy to weaken over the coming year, the highest share since 2011. Last month, a net 12% still expected better growth in Europe, with the 81-point swing marking the biggest month-on-month drop on record (going back to 1994).

United States

A strong recovery for US equities last week, with the S&P 500 Index recording its strongest weekly performance since November 2020 (+6.2%). Also, the Dow Jones Industrial Average gained +5.5%, the Nasdaq rose 8.2% and the small-cap Russell 2000 Index was up 5.4%. Volatility declined, with the CBOE VIX index down 22% last week. As discussed, the Fed meeting was a key focus, but sentiment also improved on possible signs of progress in Russia/Ukraine peace talks and as China made constructive comments in regards to stabilising markets. With the move higher, the S&P 500 Index traded back to close around its 200-day moving average, a key technical level.

Looking to sector performance, the best-performing were consumer discretionary and technology, whilst the laggards were utilities and energy. The gains in tech were a key market driver. The NYSE FANG+ Index was up 13.6%, and Chinese ADRs bounced back sharply thanks to the constructive commentary from China (AliBaba +25%, Baidu +25%).

Looking to other asset classes, the selloff in US Treasuries continued, with the 10-year yield up 15.7 bps to 2.15%, and it was notable the US 5- year/10-year curve inverted (first time since March 2020), and the 2-year/10-year spread traded down to the lowest level since February 2020.

US credit markets showed signs of stabilisation on the improved market sentiment, with investment grade credit spreads tightening.

Finally, last week we flagged the CNN Fear & Greed Index was at stretched levels in “Extreme Fear” territory and, with that, there was a risk of a sharp reversal in sentiment and market performance. This proved timely, as it has now swung sharply out of “Extreme Fear” to “Fear” territory as markets recovered ground last week. 

ASIA-Pacific

Last week the market saw a near complete reversal, with the MSCI Asia Pacific Index closing the week up 4.13%, having closed the previous week down 4.06%.

It was a bit of perfect storm at the start of the week, with a sharp rise in COVID-19 cases and implications on demand & supply chains, as well as further worries about a new Sino-Russian relationship and possible sanctions if China was to visibly provide support.

In China, we saw Shenzhen going into lockdown and companies announcing a production halt due to the pandemic in Shenzhen, Shanghai and Jilin. China’s stance on Russia was in focus, amid reports Russia asked Beijing for military equipment and other help. US officials warned Beijing that impeding efforts to punish Russia could have major consequences. Regulatory pressures also weighed on markets, amid fears Chinese firms will be delisted in the United States.

On Tuesday, we did see some slightly better economic news in China, with February industrial production growing 7.5% year-over-year (Y/Y) and retail sales growing 6.7% Y/Y; however, investors seemed to ignore this, focusing more on the geopolitical situation. Elsewhere, the market was surprised that we saw no MLF rate cut by the People’s Bank of China, despite better February data.

In Hong Kong it was a similar story, with weaker markets Monday and Tuesday. Technology and property names were particularly hard hit once again.

After a couple bearish days, on Wednesday, we started to see a reversal, with “dip buying” seen across the region. Regulatory concerns attributed for recent volatility amid a threat the United States would delisting China stocks from the NYSE abated somewhat, with China keeping dialogue open with US regulators and announcing that it would keep supporting overseas share listings, as well as vowing to keep stock markets stable. Reuters’ Tankan Survey showed Japan manufacturer sentiment firmed, but services sector sentiment weakened amid reintroduction of COVID-19 restrictions and inflation pressures.

On Thursday we continued to see a proper bounce in markets. Deeply oversold conditions, liquidity, one-sided positioning, and cheap valuations all suspected of magnifying the rebound. In China, the sharp upswing was attributed to government commentary about supporting the economy and markets; also, a drop in new COVID-19 cases offered some reprieve after Shenzhen allowed some companies to resume operations, easing concerns of a prolonged lockdown. Indications of a softer approach on tackling real estate risks was attributed for a surge in property developers. On the economic front, some highlighted Chair Powell’s reassurance about growth as a positive for risk sentiment, and we heard dovish remarks from Bank of Japan (BOJ) Governor Kuroda, who reiterated that it was too early to talk about exiting stimulus given below-target inflation.

We saw a mixed day on Friday, with China’s equity rally halted. President Biden spoke with China’s President Xi Jinping amid heightened tensions over Russia’s invasion, with Biden seeking to convince China to increase pressure on Moscow after Secretary of State Blinken said Biden will make clear the United States will not hesitate to impose costs on Beijing if it supports Russia’s invasion. China continued to deny the accusations and on Thursday described itself as a “friendly country” for Ukraine. BOJ left policy settings unchanged as expected, an easing bias maintained with the BOJ vowing to continue stimulus until inflation rises above 2% in a stable manner.

Week Ahead

Macro Week Ahead Highlights

NATO members meet in Brussels to discuss further actions to stop the Russian aggression. Attention will be on US President Biden, who’ll join in person on 24 March. After the Fed lifted interest rates and signalled interest-rate hikes at all remaining meetings this year, Powell will be speaking in Washington on Monday. Finally, on Wednesday, UK Chancellor of the Exchequer Rishi Sunak delivers his “Spring Statement” to parliament, outlining the government’s public spending plans and priorities.

Calendar

Monday 21 March

  • Germany Producer Price Index (PPI)

Tuesday 22 March

  • UK public finances (Public Sector Net Cash Requirement)
  • Eurozone ECB current account (CA)
  • Italy CA balance
  • Eurozone construction output
  • ECB President Christine Lagarde is scheduled to speak at the BIS Innovation Summit
  • US Richmond Fed manufacturing survey

Wednesday 23 March

  • UK Consumer Price Index and Retail Price Index
  • UK spring statement
  • Eurozone consumer confidence
  • BOE Governor Andrew Bailey and Fed Chair Jerome Powell are due to speak on a panel about “challenges for central bank governors in a digital world”

Thursday 24 March

  • France manufacturing confidence
  • Eurozone Markit and Eurozone Manufacturing Purchasing Managers’ Index (PMI)
  • Australia PMIs
  • Japan PMIs and PPI
  • US President Joe Biden is scheduled to meet NATO and European leaders in Brussels.
  • US Jobless claims, CA, and durable goods

Friday 25 March

  • UK retail sales including automobile fuel
  • Spain gross domestic product (GDP)
  • US state employment

Franklin Templeton Key risks & Disclaimers:

What Are the Risks?

All investments involve risks, including the possible loss of principal. The value of investments can go down as well as up, and investors may not get back the full amount invested.  Stock prices fluctuate, sometimes rapidly and dramatically, due to factors affecting individual companies, particular industries or sectors, or general market conditions. Bond prices generally move in the opposite direction of interest rates. Thus, as prices of bonds in an investment portfolio adjust to a rise in interest rates, the value of the portfolio may decline. Investments in foreign securities involve special risks including currency fluctuations, economic instability and political developments. Investments in developing markets involve heightened risks related to the same factors, in addition to those associated with their relatively small size and lesser liquidity.

Any companies and/or case studies referenced herein are used solely for illustrative purposes; any investment may or may not be currently held by any portfolio advised by Franklin Templeton. The information provided is not a recommendation or individual investment advice for any particular security, strategy, or investment product and is not an indication of the trading intent of any Franklin Templeton managed portfolio.

Past performance is not an indicator or guarantee of future performance. There is no assurance that any estimate, forecast or projection will be realised.

This article reflects the analysis and opinions of Franklin Templeton’s European Trading Desk as of 21 March 2022, and may vary from the analysis and opinions of other investment teams, platforms, portfolio managers or strategies at Franklin Templeton. Because market and economic conditions are often subject to rapid change, the analysis and opinions provided may change without notice. An assessment of a particular country, market, region, security, investment or strategy is not intended as an investment recommendation, nor does it constitute investment advice. Statements of fact are from sources considered reliable, but no representation or warranty is made as to their completeness or accuracy. This article does not provide a complete analysis of every material fact regarding any country, region, market, industry or security. Nothing in this document may be relied upon as investment advice or an investment recommendation. The companies named herein are used solely for illustrative purposes; any investment may or may not be currently held by any portfolio advised by Franklin Templeton. Data from third-party sources may have been used in the preparation of this material and Franklin Templeton (“FT”) has not independently verified, validated or audited such data. FT accepts no liability whatsoever for any loss arising from use of this information and reliance upon the comments, opinions and analyses in the material is at the sole discretion of the user. Products, services and information may not be available in all jurisdictions and are offered by FT affiliates and/or their distributors as local laws and regulations permit. Please consult your own professional adviser for further information on availability of products and services in your jurisdiction. 

Issued by Franklin Templeton Investment Management Limited (FTIML) Registered office: Cannon Place, 78 Cannon Street, London EC4N 6HL. FTIML is authorised and regulated by the Financial Conduct Authority.


MeDirect Disclaimers:

This information has been accurately reproduced, as received from Franklin Templeton Investment Management Limited (FTIML). No information has been omitted which would render the reproduced information inaccurate or misleading. This information is being distributed by MeDirect Bank (Malta) plc to its customers. The information contained in this document is for general information purposes only and is not intended to provide legal or other professional advice nor does it commit MeDirect Bank (Malta) plc to any obligation whatsoever. The information available in this document is not intended to be a suggestion, recommendation or solicitation to buy, hold or sell, any securities and is not guaranteed as to accuracy or completeness.

The financial instruments discussed in the document may not be suitable for all investors and investors must make their own informed decisions and seek their own advice regarding the appropriateness of investing in financial instruments or implementing strategies discussed herein.

If you invest in this product you may lose some or all of the money you invest. The value of your investment may go down as well as up. A commission or sales fee may be charged at the time of the initial purchase for an investment. Any income you get from this investment may go down as well as up. This product may be affected by changes in currency exchange rate movements thereby affecting your investment return therefrom. The performance figures quoted refer to the past and past performance is not a guarantee of future performance or a reliable guide to future performance. Any decision to invest in a mutual fund should always be based upon the details contained in the Prospectus and Key Investor Information Document (KIID), which may be obtained from MeDirect Bank (Malta) plc.

MeDirect Bank to discuss geopolitical tensions and natural resources during upcoming online webinar

 

MeDirect Bank is organising its thirteenth webinar in this successful series of medirectalks.  Taking place on Wednesday 23rd March, the upcoming medirectalk will be discussing implications of the ongoing Russia-Ukraine war and discuss what the latest developments could indicate for global economies and markets, with a particular focus on natural resources. This event will take place online and it’s free of charge.

MeDirect will be holding this event with BlackRock, an American multinational investment management corporation based in New York. Founded in 1988, initially as a risk management and fixed income institutional asset manager, BlackRock is the world’s largest asset manager.

The main theme of this talk will be natural resources. Historically, commodities and natural resources equities have performed strongly in absolute terms and relative to broader equity markets during periods of rising inflation expectations. The natural resources sector has a critical role to play in an orderly transition to a low carbon global economy.

The keynote guest speaker will be Alex Foster, Vice President and product strategist at Blackrock who is responsible for covering BlackRock’s Thematics equity fund range as well as its active natural resources equity products. Mr. Foster’s primary areas of coverage include the Sustainable Energy, Future of Transport and Mining & Gold strategies. He joined BlackRock in 2013. Prior to joining BlackRock, Mr. Foster worked in the product specialist division at Legg Mason Global Asset Management. Mr. Foster earned a BSc. degree in Economics from the University of Newcastle in 2013.

Matthew Kilroy Creuso, Vice President at BlackRock, who works in the Italy iShares & Wealth team, will also be joining the event. Matthew is the Relationship Manager for some of the most prominent Italian clients, along with leading the sales effort in Offshore Countries, namely Malta and Greece. Prior to this, Matthew worked in the UK Retail Sales Team, as part of the Telesales initiative. Matthew started his career in 2012 at the European Parliament, before working as an intern at Commerzbank in 2013 in Equity Derivative Sales. In 2014 he worked in Paris in Equity Sales for Oddo covering Italian clients. Mr. Kilroy Creuso earned an BSc degree, in Economic History from the London School of Economics in 2011.

Participants will be invited to ask their questions during a Q&A session. Questions can be submitted via the online platform during the event or sent in advance to registrations@medirect.com.mt

This webinar will be held through WebEx and one will be required to input their email address and accept a disclaimer to join the event on the 23rd of March at 18:00. Further information, can be found here: https://medirect.com.mt/invest/medirectalk

 


The information given during this seminar is being provided by BlackRock. The information contained in this talk is for general information purposes only and is neither intended to provide legal or other professional advice nor does it commit MeDirect Bank (Malta) plc to any obligation whatsoever. The information available during the seminar is not intended to be a suggestion, recommendation or solicitation to buy, hold or sell, any securities and is not guaranteed as to accuracy or completeness. The financial instruments discussed may not be suitable for all investors and investors must make their own informed decisions and seek their own advice regarding the appropriateness of investing in financial instruments or implementing strategies discussed herein.

The financial instruments discussed in this seminar may not be suitable for all investors and investors must make their own informed decisions and seek their own advice regarding the appropriateness of investing in financial instruments or implementing strategies discussed herein.

If you invest in any of the products discussed you may lose some or all of the money you invest. The value of your investment may go down as well as up. A commission or sales fee may be charged at the time of the initial purchase for an investment and may be deducted from the invested amount therefore lowering the size of your investment. Any income you get from this investment may go down as well as up. This product may be affected by changes in currency exchange rate movements thereby affecting your investment return therefrom. The performance figures quoted refer to the past and past performance is not a guarantee of future performance or a reliable guide to future performance. Any decision to invest in a mutual fund should always be based upon the details contained in the Prospectus and Key Investor Information Document (KIID), which may be obtained from MeDirect Bank (Malta) plc.

Franklin Templeton Insights: Russia-Ukraine War Heightens Supply Chain and Inflation Woes

The Russian invasion of Ukraine has shaken up the world across several dimensions. Between the loss of life and destruction of Ukrainian infrastructure, it has been extremely unsettling for us to watch and absorb. Beyond Ukraine, the Russian invasion has affected many parts of the global economy, in particular the global supply chain of key commodities. Our team takes a deep dive into what this war could mean for global supply chains and potential problems surrounding the supply and export of key commodities including gas and oil, autos, semiconductors, food and fertiliser.

Key Points

  • Global Supply Chain Woes: Inflation pressures were already elevated heading into 2022, and the Russia/Ukraine war is creating additional concerns. Energy pressures are well documented, but other areas such as autos, semiconductors, food and fertilisers will also be deeply impacted by the Russian/Ukraine war.
  • Global Macro Implications: We are facing rising inflation, slowing demand and a precarious policy environment. Inflation and growth impacts are expected to be felt more acutely in the European region, given stronger trade ties to Russia.

Russia-Ukraine War Heightens Supply Chain and Inflation Woes Article Image 1
Russia-Ukraine War Heightens Supply Chain and Inflation Woes Article Image 2

Global Supply Chain Woes

 

Energy

Many countries are attempting to move away from Russian energy imports despite such high global exposure. The United States has enacted a total ban on Russian energy imports, while the United Kingdom and European Union (EU) have announced plans to significantly decrease Russian energy imports by year-end. This will take time given how large of a customer the EU-27 is for Russian energy. Energy commodity curves have moved into steep backwardation as a result.

Key Facts

  • Russia accounts for 2% of global gross domestic product (GDP), but accounts for 12% and 17% of global oil and natural gas production, respectively.
  • The EU depends on Russia for 40% of its natural gas. Russia also supplies 27% of the 27-country bloc’s oil imports, and 46% of its coal imports.
  • The first European move away from Russian oil resulted from Germany suspending the certification process of the Nord Stream 2 Baltic Sea gas pipeline, which finished construction in September and would have nearly doubled the flow of Russian gas into Germany.
  • Ahead of Russia’s invasion of Ukraine, European spot gas prices had risen 400% over the previous year (as at 23 February) due to the global reopening and significantly cold winter across Europe.

Autos 

The war in Ukraine has created a parts shortage that has now forced automakers to shut down key European plants. This takes place as the auto industry faces the potential for longer-term disruption in metals and chips supplies due to significant Russia and Ukraine exposure.

Key facts

  • Russia is the world’s biggest exporter of palladium (40%) and second-biggest exporter of platinum, both of which are used in the construction of autocatalytic converters for vehicles.
  • Ukraine is a key supplier of wiring harnesses that are needed to organise a car’s wiring and connect its various components.
  • Difficulties in receiving wiring harnesses from Ukraine has forced both German-based Volkswagen (VW) and BMW to idle certain plants in Germany while acknowledging that other plants will begin to slowdown as well.
  • Ukraine produces 70% of the world’s neon gas—most of which is used to produce semiconductors and automotive chips. This exposes automakers and electric vehicle (EV) producers to greater challenges with replenishing already-depleted chip inventories should the war in Ukraine effect neon gas production and transportation.

Semiconductors

Neon gas—one of the key materials needed for semiconductor production—predominantly comes from Ukraine. While the longer-term concerns center around Ukraine’s neon gas production, the current issues revolve around the closure of the Black Sea ports that transport the existing stock of neon gas to the rest of the world.

Key Facts:

  • Russia and Ukraine produce 40%-50% of semiconductor-grade neon. Largely derived from Russian steel manufacturing, neon gas is purified in Ukraine so it can be used in lasers that help in the design of semiconductors. 
  • Up to 75% of the world’s neon supply is used to make semiconductors.
  • Semiconductor production could also be impacted longer term given the high exposure to Russia’s production of palladium, a metal that is used in sensor chips and certain types of computing memory.
  • Large chip companies such as Intel have said they expected limited supply chain disruption for now from the Russia-Ukraine war, thanks to raw material stockpiling and diversified procurement. This is a positive acknowledgement given the White House warned the semiconductor companies to diversify their supply if Russia retaliates against current sanctions by blocking access to key materials such as neon gas.

Food

Ukraine’s predominant trade partners for food are the Middle East and North Africa; these regions will be impacted the most from any war-related food disruptions. Ukraine and Russia combined account for 29% of global wheat exports, with the Black Sea region effectively regarded as the “breadbasket of the world”. However, this will now strictly be the breadbasket of Ukraine since the Ukrainian government has banned exports of wheat and other food staples to prevent a humanitarian crisis in the region.

Key facts

  • Ukraine supplies about 15% of the global corn supply. Major customers include China and the EU.
  • Russia and Ukraine together represent almost 30% of the world’s barley supply.
  • In addition, Ukraine is the global leader in sunflower oil and together with Russia accounts for 75% of global sunflower oil exports, which represent about 10% of all cooking oil.
  • Planting for corn, barley and sunflower seeds will start in April and occur directly in areas where the Russian military is currently bearing down. Ukraine’s next wheat harvest is also set to begin during the upcoming summer.

Fertilisers

Russia is a major producer of potash, phosphate and nitrogen-containing fertilisers which represent roughly 13% of global fertiliser exports. Following a Russian ban on ammonium nitrate fertiliser, the Russian Ministry of Industry and Trade has now called for a broad suspension of fertiliser exports. The potential for a persistent fertiliser shortage could increase farming costs and lower crop yields, producing global food shortages and inflation.

Key facts

  • A significant development comes from Russia banning the export of ammonium nitrate, a key fertiliser for which Russia accounts for two-thirds of the global market.
  • This ban comes at a crucial time, as the world has already faced fertiliser disruptions leading up to the war in Ukraine.
  • Brazil is the most affected country given its status as the largest producer of coffee, soybeans, and sugar. It is enormously dependent on fertiliser imports: 85% of its fertilisers are imported annually, with 20% coming from Russia which will be impacted by the ban.
  • Inventory levels suggest that Brazil’s local fertiliser stocks will only last for the next three months as Julia Meehan, head of fertilisers for the commodity price agency ICIS, highlights that “All everybody is talking about is availability. There are huge concerns”.

Global Macro Implications and Multi-Asset Considerations

Inflation was high as we headed into 2022. There were some promising signs of supply chain woes starting to ease—supplier delivery times were starting to improve, prices paid by businesses were starting to fall, and the slow fading of durable goods demand were all giving signs that inflation may ease in the new year. As the Russia-Ukraine war has escalated, the rise in energy prices has derailed much of the optimism we had entering 2022.

The current macro outlook has darkened. Our inflation expectations have risen dramatically. Importantly, we view the current rise in inflation as being supply-driven, and consequently expect the rise in prices to negatively affect household and business demand. We were already seeing the negative impacts of high inflation on consumer confidence, and now expect additional headwinds to real consumer spending, even as most private sector balance sheets remain healthy. Lastly, the mixture of higher inflation and lower demand adds to an already precarious policy environment. Central banks in most major regions are expected to hike this year, in some cases significantly. It will be difficult for policymakers to engineer a soft landing in this volatile macro environment; the risk of a policy error has risen.


 

Franklin Templeton Key risks & Disclaimers:

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What are the risks?

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This information has been accurately reproduced, as received from Franklin Templeton Investment Management Limited (FTIML). No information has been omitted which would render the reproduced information inaccurate or misleading. This information is being distributed by MeDirect Bank (Malta) plc to its customers. The information contained in this document is for general information purposes only and is not intended to provide legal or other professional advice nor does it commit MeDirect Bank (Malta) plc to any obligation whatsoever. The information available in this document is not intended to be a suggestion, recommendation or solicitation to buy, hold or sell, any securities and is not guaranteed as to accuracy or completeness.

The financial instruments discussed in the document may not be suitable for all investors and investors must make their own informed decisions and seek their own advice regarding the appropriateness of investing in financial instruments or implementing strategies discussed herein.

If you invest in this product you may lose some or all of the money you invest. The value of your investment may go down as well as up. A commission or sales fee may be charged at the time of the initial purchase for an investment. Any income you get from this investment may go down as well as up. This product may be affected by changes in currency exchange rate movements thereby affecting your investment return therefrom. The performance figures quoted refer to the past and past performance is not a guarantee of future performance or a reliable guide to future performance. Any decision to invest in a mutual fund should always be based upon the details contained in the Prospectus and Key Investor Information Document (KIID), which may be obtained from MeDirect Bank (Malta) plc.

Notes from the Trading Desk – Franklin Templeton

Franklin Templeton’s Notes from the Trading Desk offers a weekly overview of what our professional traders and analysts are watching in the markets. The European desk is manned by eight professionals based in Edinburgh, Scotland, with an average of 15 years of experience whose job it is to monitor the markets around the world. Their views are theirs alone and are not intended to be construed as investment advice.

The Digest

Last week was another week of turmoil for global equity markets as investors struggle to get to grips with the broader potential impact of the Russian invasion of Ukraine. There was some clear divergence between different regions. European equities saw some respite, bouncing off their lows on some tentative signs of progress in peace talks mid-week (although little progress came from talks). US markets lagged as they caught up with recent losses in Europe and inflationary pressures remain a concern. Asian equities also lagged as COVID-19 concerns continued to weigh on sentiment in China. On the week, the MSCI World Index declined 1.9%; the STOXX Europe 600 Index was up 2.2%; the S&P 500 Index was down 2.9% and the MSCI Asia Pacific was down 4.5%.

Markets at the Mercy of Headline Risk

Last week saw extreme volatility, particularly in Europe, as investors traded from one headline to the next on the Ukraine crisis.

We saw some aggressive moves higher in European equities on Wednesday after the somewhat perceived improvement in tone around peace discussions. The STOXX Europe 600 Index rose 4.7%, a bigger move than the COVID-19-vaccine discovery day and biggest gain since March 2020. Germany’s DAX was up 7.9%, a clear reversal of recent trends. Given we have recently seen extreme moves lower, markets seem more susceptible to good news than bad news, hence markets squeezed higher. In addition, the fund flow data (Wed to Wed) illustrated how much investors had reduced exposure to European equities, with another record week of outflows of US$13.5 billion for the region’s equities.

Nothing substantive came from peace talks between the Russian and Ukrainian foreign ministers, with some fairly barbed comments from both sides after the meeting. However, markets were volatile again on Friday after a vague comment from Russian President Vladimir Putin that there had been positive shifts in talks with Ukraine. This was later dismissed by Ukraine, but it was enough to see European equities spike higher and end the week in positive territory. Overall, it demonstrates how nervous investors are around missing any move higher, given that exposure to the region has been reduced sharply in recent weeks.

Looking away from equity markets, commodity markets also remained volatile through the week. Crude oil was in focus, as the United States and United Kingdom announced plans to stop the import of Russian crude oil. In addition, there has been a push to find alternative supply, with the United Arab Emirates reported to be calling on OPEC+ to increase oil production faster that currently projected and, remarkably, the United States is looking at easing restrictions on Venezuela, which could see an additional 400k barrels/day come to market. Of the five million barrels of crude oil Russia exports each day, about 50% goes to Europe. Russian imports account for 8% of total UK oil demand. The United States is less reliant, with 3% of imported oil coming from Russia in 2020. With that, West Texas Intermediate crude oil fell 5.5% to US$126.39 last week.

Gas markets were also volatile, although by the end of the week European gas had fallen 30% (still up +65% year-to-date). There was also a little profit-taking in wheat, but concerns over food price inflation remain. The UN Food Price Index is +23% year-to-date, risking increased pressure on consumers globally.

European bond yields widened (the German bund moved from -10 basis points to +30 basis points [bps] last week) and European credit spreads remained wider that recent levels, but still far from the levels since in 2020.

Looking ahead, any progress in peace talks will likely see markets squeeze again. Ukraine President Volodymyr Zelenskyy said there were talks over a possible meeting between himself and Putin. He also said that there were daily video talks between his representatives and the Russians. However, this is against a backdrop of escalating violence in many Ukrainian cities and a widening of Russian bombing targets over the weekend.

Another key date to watch this week is 16 March, when US$117 million in interest payments on a Russian sovereign bond is due to be paid out. Russia has suggested it will pay international holders in “unfriendly countries” in rubles instead of dollars. Fitch downgraded Russia by six notches on Tuesday evening to “C,” citing both domestic measures and foreign sanctions introduced in response to the country’s invasion of Ukraine as making a bond default “imminent”. Other global rating agencies including Moody’s and S&P have also lowered their ratings for Russia in recent weeks, and a number of economists are reducing their growth forecasts for Europe.

Central Bank Focus

Aside from events in Ukraine, it is a big week for central bank meetings this week, including the Federal Reserve (Fed), Bank of England (BoE) and the Bank of Japan to come this week. Last week, the European Central Bank (ECB) surprised the market somewhat with a more hawkish tilt on Thursday. Notably, it dropped the tone implying rates could go lower than current levels and on also pointed to a faster wind down of the Asset purchase Programme, which is now likely to end in the third quarter (vs. expectations of the fourth quarter previously). Unsurprisingly, the ECB cut its growth forecast for 2022 (3.7% vs. 4.2% previously), and hiked its inflation forecast (5.1% vs. 3.2% previously). The market is currently pricing in one rate hike by the end of 2022 now.

Looking to the week ahead, the market expects both the Fed and the BoE to raise rates by 25 bps. The uncertainty created by the Ukraine crisis has made the chances of a 50 bps rate hike from the Fed a lot less likely, as alluded to by Fed Chair Jerome Powell in recent weeks. However, inflationary pressures are clear, with US Consumer Price Index (CPI) printing at 7.9% (a 40-year high), so the market does still expect six rate hikes by year end.

Week in Review

Europe

As discussed, investor focus in Europe has been on the crisis in Ukraine and the  recent ECB meeting. As noted, the STOXX Europe 600 Index saw its first weekly gain in four weeks, and Spain’s IBEX rose 5%, while Germany’s DAX rose 5%. Looking at sectors, banks, travel & leisure were strong, while autos lagged.

Italian macro data gives us a good insight into some of the challenges Europe faces, with last week’s January Industrial Production slumping 3.4%. Italian producer price index (PPI) data showed a gain of 12.6% for January and up 41.8% year-over-year.

United States

US equities mirrored the recent weakness in Europe last week, closing the week down nearly 3%. The violence in Ukraine and the subsequent geopolitical tensions continued to be the key focus for investors, as Western governments discussed imposing further sanctions on Russia. Credit markets were also closely watched as an indicator of stock market performance, with US real yields back at the lows, which should make equities appear more attractive. Despite that, in terms of sectors, energy stocks managed to gain last week, despite a dip in oil prices. All other sectors finished lower.

The latest US CPI report showed that inflation was at a 40-year high in February. The report was in line with expectations at +7.9% year-over-year. As expected, energy prices were strong given the recent rises in oil and gas prices. This had a knock-on effect to grocery inflation, rising 1.4%, its strongest increase in four decades. Transportation, rent growth and service inflation all contributed to the strong print. Inflation does appear to be levelling off in the auto sector; however, the sector still faces a number of supply-chain headwinds near term. Whilst the market will remain at the mercy of the next headline on Ukraine, investor attention in the United States will shift this week towards the latest Fed meeting.

On the energy front, the Biden administration is reportedly open to easing sanctions on Venezuela in exchange for a ramp-up in oil exports. This came after the United States had banned imports of Russian oil. The White House defined that as a “significant action with widespread bipartisan support that will further deprive President Putin of the economic resources he uses to fund his needless war of choice.” The statement also said that the United States did not expect nor require European allies to take the same step and added that the United States was only in a position to do so because of its “strong domestic energy production and infrastructure.”

The White House announced that 90 million barrels would be released from the US Strategic Petroleum Reserve in order to keep energy prices down for Americans. Also, US Energy Secretary Jennifer Granholm told oil executives in Houston on Wednesday that the United States was now on a “war footing” and called on them to increase oil production immediately in a collective effort to avert a price spike.

The CNN Fear & Greed Index remains in “Extreme Fear” territory, indicating the extent of investor angst, but also the risk of a sharp move higher on any positive headlines.

Asia-Pacific

Last week was poor across Asia, with the MSCI Asia Pacific closing down 4.05%, dominated mainly by concerns over the Russia-Ukraine conflict and increasing COVID cases leading to restrictions across the region. We note that a new coronavirus variant that fuses elements of Delta & Omicron was identified last week. There were US threats of reprisals against Chinese firms found defying Russian sanctions and Norway’s sovereign wealth fund sold down some of its Chinese positions. In addition, surging commodity prices and worsening inflationary pressures are putting central banks in a situation of needing to tighten policy without choking growth. Risk of a consumer spending pullback amid escalating cost of living are driving concerns about stagflation as flattening yield curves and falling equity markets signal potential trouble for the global economy.

The markets got off to a poor start last week, with the prospect of a Russian oil embargo hitting risk assets especially and driving big gains in crude oil and metals prices.

Hong Kong’s equity market was the standout underperformer, closing the week down about 6%. Once again, COVID-19 is having a big impact as Hong Kong’s plan to test the entire population for coronavirus in March has been indefinitely postponed as the city prioritises vaccinating the elderly and reducing fatalities, according to Chief Executive Carrie Lam.

China’s mainland equities closed last week down 4%. On Monday, the government unveiled GDP growth of around 5.5% for 2022, above economist expectations. However, China reported the most new COVID-19 cases since the initial Wuhan outbreak and Premier Li reiterated the “Zero COVID” policy will stay but will be fine-tuned to minimise economic disruptions. China is increasingly seen as a part of the nexus with the United States threatening repercussions for Chinese companies defying export restrictions to Russia. Beijing appears to be standing with Russia amid reports it is weighing stakes in Russian commodity firms. China also warned the United States against forming a Pacific version of NATO, reiterating at the National People’s Congress that it remains committed to resolving the Taiwan question.

On Thursday of last week, South Korea’s presidential election saw opposition candidate Yoon from the People Power Party winning with the narrowest margin in history. Yoon is known for promoting more cooperation with US and sanctions against Russia and North Korea.

The Week Ahead

Events in Ukraine will continue to be a key driver for investor sentiment, with markets likely to see-saw on any meaningful news. Hopes for progress from talks seems to have faded after a burst of optimism on Wednesday saw markets squeeze higher. That said, it is a busy week for central banks too, with the Fed policy meeting on Wednesday and BoE on Thursday.  The market is pricing a 25 bps interest-hike for both. Note the BoJ also meets on Friday.

Calendar of Events

Monday, 14 March:

  • US State employment

Tuesday, 15 March:

  • UK Claimant Count & ILO Unemployment Rate
  • France CPI
  • Eurozone Industrial Production
  • US Core PPI
  • RBA Meeting Minutes
  • Chinese Industrial Production

Wednesday, 16 March:

  • Italy CPI
  • US Import prices & retail sales
  • Federal Open Market Committee meeting and statement
  • Japanese IP

Thursday, 17 March:

  • Eurozone EU27 New Car Registrations
  • Eurozone CPI
  • UK Bank of England policy meeting
  • US Jobless claims
  • US Industrial & Manufacturing production

Friday, 18 March:

  • Eurozone Trade Balance
  • BoJ Policy Meeting

Franklin Templeton Key risks & Disclaimers:

What Are the Risks?

All investments involve risks, including the possible loss of principal. The value of investments can go down as well as up, and investors may not get back the full amount invested.  Stock prices fluctuate, sometimes rapidly and dramatically, due to factors affecting individual companies, particular industries or sectors, or general market conditions. Bond prices generally move in the opposite direction of interest rates. Thus, as prices of bonds in an investment portfolio adjust to a rise in interest rates, the value of the portfolio may decline. Investments in foreign securities involve special risks including currency fluctuations, economic instability and political developments. Investments in developing markets involve heightened risks related to the same factors, in addition to those associated with their relatively small size and lesser liquidity.

Any companies and/or case studies referenced herein are used solely for illustrative purposes; any investment may or may not be currently held by any portfolio advised by Franklin Templeton. The information provided is not a recommendation or individual investment advice for any particular security, strategy, or investment product and is not an indication of the trading intent of any Franklin Templeton managed portfolio.

Past performance is not an indicator or guarantee of future performance. There is no assurance that any estimate, forecast or projection will be realised.

This article reflects the analysis and opinions of Franklin Templeton’s European Trading Desk as of 14 March 2022, and may vary from the analysis and opinions of other investment teams, platforms, portfolio managers or strategies at Franklin Templeton. Because market and economic conditions are often subject to rapid change, the analysis and opinions provided may change without notice. An assessment of a particular country, market, region, security, investment or strategy is not intended as an investment recommendation, nor does it constitute investment advice. Statements of fact are from sources considered reliable, but no representation or warranty is made as to their completeness or accuracy. This article does not provide a complete analysis of every material fact regarding any country, region, market, industry or security. Nothing in this document may be relied upon as investment advice or an investment recommendation. The companies named herein are used solely for illustrative purposes; any investment may or may not be currently held by any portfolio advised by Franklin Templeton. Data from third-party sources may have been used in the preparation of this material and Franklin Templeton (“FT”) has not independently verified, validated or audited such data. FT accepts no liability whatsoever for any loss arising from use of this information and reliance upon the comments, opinions and analyses in the material is at the sole discretion of the user. Products, services and information may not be available in all jurisdictions and are offered by FT affiliates and/or their distributors as local laws and regulations permit. Please consult your own professional adviser for further information on availability of products and services in your jurisdiction. 

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MeDirect Disclaimers:

This information has been accurately reproduced, as received from Franklin Templeton Investment Management Limited (FTIML). No information has been omitted which would render the reproduced information inaccurate or misleading. This information is being distributed by MeDirect Bank (Malta) plc to its customers. The information contained in this document is for general information purposes only and is not intended to provide legal or other professional advice nor does it commit MeDirect Bank (Malta) plc to any obligation whatsoever. The information available in this document is not intended to be a suggestion, recommendation or solicitation to buy, hold or sell, any securities and is not guaranteed as to accuracy or completeness.

The financial instruments discussed in the document may not be suitable for all investors and investors must make their own informed decisions and seek their own advice regarding the appropriateness of investing in financial instruments or implementing strategies discussed herein.

If you invest in this product you may lose some or all of the money you invest. The value of your investment may go down as well as up. A commission or sales fee may be charged at the time of the initial purchase for an investment. Any income you get from this investment may go down as well as up. This product may be affected by changes in currency exchange rate movements thereby affecting your investment return therefrom. The performance figures quoted refer to the past and past performance is not a guarantee of future performance or a reliable guide to future performance. Any decision to invest in a mutual fund should always be based upon the details contained in the Prospectus and Key Investor Information Document (KIID), which may be obtained from MeDirect Bank (Malta) plc.

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