RESEARCH PUBLICATIONS

Research publications.

Research publications.

Catch up on financial markets, with our latest research and insights.

What does the Chinese devaluation mean?

September 2015

Citi analysts view the mid-August move by China's central bank to engineer a devaluation of its currency as a double edged sword: upside from the significant capital market reform and better net exports, but downside given capital outflow and earnings per share conversion loss.

Managing volatility and risk

August 2015

Markets have been volatile amid Greece and China concerns; however Citi analysts don't believe either of these country-level issues risks a turning point for the world economy. Our view is that Greek contagion risks have greatly diminished, and the Chinese government's confidence boosting measures will stabilise the market.

Still bullish on equities, but mind the corrections

May 2015

The MSCI All Country World index is now 10% above 2007 highs. Given the subsequent 2008-09 experience this makes investors nervous. However, with the exception some developed markets such as US (+36%) and Germany (+13%), there are still many markets trading below their previous peaks. Rather than just feeding off a deluge of cheap money, the progress in global share prices has actually been supported by similar progress in fundamentals i.e. GDP and EPS.

When will the Fed be ready to act?

April 2015

Citi analysts believe the signal to the market is that the Fed is on the path to raising interest rates, but not in a big hurry. We remain longer-term bullish on equities and anticipate the USD to resume its upward trend, but expect there could be volatility as the Fed's monetary policy evolves later this year. In this environment, we prefer selective sectors in the US with a tilt toward cyclical such as Financials and Tech.

Euro equities: Still attractive despite political risks

March 2015

On 22 January 2015, the European Central Bank announced its long-awaited large quantitative easing programme to stimulate the economy and boost inflation expectations. The ECB QE has been our key aspect of the bull case for European equities, supporting our view of improving economic performance in the Eurozone and 10% growth in Europe ex-UK earnings for 2015.

China equities: Our preference for H over A-shares

February 2015

CSI300/ MXCN corrected 8%/ 5% on Jan 19 given liquidity concerns following China Securities Regulatory Commission's three-month suspension of opening new margin-trading accounts for selective brokers. We had previously highlighted the liquidity risks, downgraded A-shares to Neutral, Brokers to Underweight and upgraded Health Care to Overweight.

Look beyond the horizon

Mid Year 2015

No major surprises for the first half of 2015: Global economic growth remained uneven, resulting in a divergence in monetary policy among the major central banks. We saw volatility in financial markets, but the strength of equity markets took us by surprise with the MSCI World Index gaining 4.2% as of 29 May 2015.

Stay the course

June 2014

Unexpected events continue to affect sentiment and the market's perception of economic reality. Market volatility in the first half of the year has meant that bonds have outperformed equities. What should we expect for the second half of 2014?

Manoeuvring an uneven recovery

Annual Outlook 2015

If we had expected 2014 to be any different from what we have experienced in the past few years since the global financial crisis, then we were in for a disappointment. In 2014 again we saw uncertainty in the global economy, political crisis and of course, financial market volatility. But when we look at financial market performance, it was on average another positive year for investors.

Transitioning to growth

2014 Annual

2013 certainly produced its share of uncertainty, and we ended the year with more questions than answers. Will 2014 be a year of growth where interest rates start to 'normalise', or are we in for more volatility?

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