Content (401)
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White papersEuropean high yield: default rate coming down
Our par-weighted default rate forecast for European High Yield (EHY) is 3.8% for the forward 12-month period and 7.2% for the forward 24-month period. Excluding hybrid issuers, the default rate increases to 4.5% over 12 months and 8.5% over 24 months. This compares to a LTM (last 12 months) default rate for Europe, to April 2024, of 4.1%1, and a recent peak through the Covid-19 pandemic of 6.9%.
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White papersNo Autumn chills for Global Investment Grade Corporate fundamentals
Investment grade (IG) indices remain close to recent tights. Similarly, corporate fundamentals are in an extremely strong position. Our credit work looks to identify where there is a mismatch between the fundamental expectations and valuations of issuers, on a name-by-name basis. We also aggregate the single name expectations each quarter to give a view of the market as a whole.
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White papersEuropean utilities: prepared for the spending storm
Despite huge growth in demand, costs squeezes and supply constraints around raw materials and capacity are limiting expected returns in renewables development
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White papersThe climate risk ‘hot potato’– which sector will be left with burnt fingers?
Does anyone remember Uruk, the ultra-modern city nestled amid the planet’s most fertile farmland? What about Skara Brae, the beachfront town with state-of-the-art homes, beautiful ocean views and mild weather? Nope? Well, 5,000 years ago both communities were among the world’s more desirable places to live, but the shifting climate changed things and these settlements were consigned to history.
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White papersSlow-speed crash? Problems for the European auto sector pile up
Healthy cash balances built up over the past three years will be tested as firms attempt to weather the four-pronged oncoming storm of labour relations, EV uptake, emissions regulations and China
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White papersUS election: the Inflation Reduction Act (IRA) and the risk of repeal – Implications for investors
In November the US goes to the polls to decide who will be the next president – the Democrat incumbent Joe Biden or returning Republican nominee Donald Trump. Under Biden, in August 2022 the US introduced the Inflation Reduction Act (IRA), a federal law which aims to, among other things, invest into domestic energy production while promoting clean energy. It represents the largest ever Congressional investment in the energy transition.
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White papersBoeing bonds bound to bounce back?
Boeing is an iconic name. It enjoys high levels of political support in the government of its single largest customer, the United States. It produces the president-carrying Air Force One, makes the ubiquitous commercial airliners, influences space exploration, produces military equipment and maintains significant nuclear capabilities for the US. This relationship is a substantial pillar of support for the credit.
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White papersCan the demand for critical minerals be met responsibly?
Decarbonising the economy requires a significant scaling up of green technologies such as electric vehicles (EVs), solar photovoltaics, wind turbines and grid-scale battery storage. All of which require significant mineral inputs. A deficit of these “critical minerals” – such as cobalt, copper, lithium, rare earth elements, graphite and nickel – raises supply risks that could constrain the pace and scale of the energy transition.
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White papersInflation Quarterly Monitor
Central banks continue to tread carefully when it comes to monetary easing, expressing cautious optimism about inflation yet refusing to commit on the future path of policy rate decisions. Amidst falling inflation and slowing growth, the added complexity of political risk in the US, Europe and the UK has brought greater uncertainty. Even after the European Central Bank (ECB) acted as the first mover to cut policy rates in June, other central banks did not immediately follow in their June meetings.
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White papersEurope better placed than America… and cheaper
In the US, weakening employment poses risks to both consumer expenditure and growth, while in China both the consumer and the property market are at risk. The European consumer is more confident, despite a tougher business environment.
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White papersOn pause: the one-way certainty of the market is over … for now
The macroeconomic backdrop is changing, or at least uncertain. This could shift the pricing of risk assets, but it won’t change what we do, which is look for stronger competitively advantaged businesses that fit our quality growth philosophy.
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White papersGeopolitical risks and FX reserves
In this short video, Gary Smith, Client Portfolio Manager, Fixed Income covers: What are FX reserves, and why should we care how they are managed? What triggered the idea to write the article What do geopolitical risks mean for central bank FX reserves managers? Why is self-insurance desirable? What are the implications of fixed income markets?
