Market Views

Market Commentary

asia-pacific-market-commentary

Amundi Asia Pacific Market Monthly Commentary - October 2017

The MSCI AC Asia ex-Japan index gained 4.72% (in USD terms, dividend included) last month. Asia ex-Japan equities regained its market leadership position in October, outperforming the other major equity blocs. Investors bided up valuations in this part of the world on the back of ongoing expectations of positive earnings growth in the region. China reporting 6.8% of 3Q17 GDP annualized growth, India announcing plans to recapitalise its PSU banks and strong initial pre-orders for the iphone X (positive for the region’s contract manufacturers) were the other key material developments. Elsewhere, China’s 19th National Congress of the Coummunist Party was held and concluded as scheduled with little surprises.

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asia-pacific-market-commentary

Amundi Asia Pacific Market Monthly Commentary - September 2017

The MSCI AC Asia ex-Japan index slightly lost 0.12% (in USD terms, dividend included) last month. USD saw some resurgence late in the month following US President Trump’s aggressive tax reform agenda – which includes proposed tax cuts to the corporate rate to 20% from 35% currently. This have led to slower fund inflows to the Emerging Market bloc late in September, but this episode is likely to be transient, especially if the proposed tax reform legislation is not passed. For the first time since 1999, S&P downgrading China’s sovereign rating to A+ from AA- . The rating agency held the view that rising credit growth poses increased financial risk which could have been another "excuse" that triggered additional profit taking.

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asia-pacific-market-commentary

Amundi Asia Pacific Market Monthly Commentary - August 2017

The MSCI AC Asia ex-Japan index appreciated 1.33% (in USD terms, dividend included) last month. Despite heightened military tensions in the Korean peninsula, the upside was inspired by a strong 2Q17 earnings reporting and firmer economic data point readings in the region’s leading economies (particularly China). Investors chose to overlook the escalating geopolitical climate, focusing instead on the strong fundamentals. A weak USD backdrop, with US Federal Reserve and Europe Central Bank signalling a more gradual approach to monetary policy normalisation, could be the other positive contributing factors. Due to ongoing strength in earnings upgrades and fund inflows, as long as these factors remain intact, the outperformance of Asia ex-Japan market is likely to hold.

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Expert Talk

THE ECB GOES FURTHER THAN EXPECTED

Expert Talk, 30 October 2017

ECB: QE WILL NOT "SUDDENLY" STOP

The Europe Central Bank (ECB) announced that it will halve the value of its Quantitative Easing (QE) purchases in 2018 (from EUR 60 billion to 30 billion) starting from coming January to end of September 2018. While the market was expecting a larger reduction of asset purchases, ECB’s President Mario Draghi has indicated that the QE will not stop "suddenly" after first nine months. Amundi estimated that the Eurosystem would purchase more than EUR 270 billion (9 months at EUR 30 billion) in 2018.

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Mo JI, Chief Economist, Asia ex-Japan

Expert Talk, 29 September 2017

FAQ ON CHINA'S 19TH CHINESE COMMUNIST PARTY CONGRESS

China's 19th Chinese Communist Party Congress (CCP) will be held on 18 October 2017. It is once every five year event with leadership reshuffle. While investors concern if there will be a significant change on the pace of reform before or after the meeting, Amundi believes that the reform will generally be sidelined which means no speed up or slowdown.

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Mo JI, Chief Economist, Asia ex-Japan

Expert Talk , 21 June 2017

INCLUSION OF A-SHARE IN MSCI

MSCI will include 222 Chinese A-share large cap stocks on a gradual basis beginning in June 2018. Given 5% inclusion factor, Chinese Ashare weighting in MSCI Emerging Market (EM) Index will be 0.73%. Amundi believes the move is symbolic with long term market impact and inflow.

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Tristan PERRIER, Developed Countries Economist

Expert Talk, 9 June 2017

A KEY STEP AHEAD OF BREXIT

While it’s not Amundi’s central scenario, a setback for the Conservatives could alter the conditions in which Brexit will unfold. Whatever happens, difficult negotiations are to be expected, as are temporary episodes of market stress over the prospect of an exit by the UK without an agreement with the EU.

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Philippe Ithurbide Fond Uni

Expert Talk, 8 May 2017

French Presidential Election - Macron President: risks disappear ... back to fundamentals

The second round of the presidential election provided the name of the winner: E. Macron is the next president of the French Republic (66% of the votes).

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2017-03-French election urn

Expert Talk, 24 April 2017

French Presidential Elections - the Aftermath of the First Round

The first round finally delivered its verdict: Emmanuel Macron (En Marche!) arrived in the lead with 23.9% of the votes, ahead Marine Le Pen (Front National) with 21.4%.

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Mo JI, Chief Economist, Asia ex-Japan

Expert Talk, 29 March 2017

A NOTE BEFORE XI MEETS TRUMP

Chinese President Xi Jinping will meet U.S President Donald Trump in Florida next week. It will be their first meeting since Trump took the

office in January. Amundi believes the meeting can only bring two countries closer and the relationship between US and China would be

cooperative rather than a trade war.

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2017-03-French election urn

Expert Talk , 23 March 2017

French Presidential Election - The candidates and budgetary / fiscal policies: what is at stake

This note discussing the budgetary policies of the five main candidates running for French president is the fourth in a series that will accompany you until the results of the presidential and legislative elections (and probably a little further).

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2017-03-French election urn

Expert talk, 9 March 2017

French Presidential Election French economy recovery: where are we?

This note is the second in a series that will accompany you until the results of the presidential and legislative elections (and probably a little further). Here we focus on an assessment of the French economy.

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2017-03-French election urn

Expert talk, 1st March 2017

French Presidential Election Taking stock of the situation and decrypting current issues

This note is the first in a series that will accompany you until the results of the presidential and legislative elections (and probably a little further). Here we set the scene before proposing specific thematic topics.

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Mo JI, Chief Economist, Asia ex-Japan

Expert talk, 10 February 2017

5 UNDER-ESTIMATED POSITIVE SURPRISES FROM CHINA

We have observed five positive surprises coming from China. Investors should not miss these signs as they are not yet priced in or very
much underestimated. Noteworthy, these signs included global commodity demand increase resulted by overcapacity reduction and further environment deterioration in China, along with private capex growth in China are much stronger than market expected with momentum.

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