Market Insights – 9th of September 2019

Each week, a team of experts shares its market views with you.

Contact us
Paysage Forêt Finance


German manufacturing is still stuck in the doldrums, raising concerns that the slowdown will spread to the rest of the economy, which for the moment is holding up well. Factory orders fell more than forecast, dropping 2.7% on a monthly basis, mainly because of a decline in export orders. And industrial output was down for the second month in a row (–0.6% month on month). 

Tensions between Hong Kong’s police and protesters are still running high despite the government’s efforts to make amends by withdrawing the extradition bill. The protests have hit the local economy hard, especially the property, retail and tourism sectors, which are unlikely to bounce back anytime soon.

Despite the possible impact of advance purchases, Chinese exports slumped in August after unexpectedly rising in July. Unsurprisingly, shipments to the USA slowed the most, down 16% year on year. 

A superhero makes his exit

Although his term as president of the European Central Bank (ECB) doesn’t officially end until 31 October, Mr Draghi is getting ready for one of the last encore in his career as a central banker this week. And his final bow comes at a crucial moment. The eurozone economy is running out of steam, and expectations for the ECB meeting are riding high. For the moment, the slowdown is most obvious in the manufacturing sector. Domestic consumer spending is holding up well thanks to the dip in unemployment and a slight rise in wages.

Lacklustre trade and the uncertainty caused by the US-China trade war are responsible for the manufacturing sector’s current woes. With Germany and Italy flirting with recession, Super Mario once again has a lot on his shoulders.

After several years of aggressive monetary stimulus, eurozone inflation is still at rock bottom. And if the current slowdown is too sharp, the worst nightmare of any central banker may come true.

In an industrialised world where structural debt levels are high and the population is shrinking, deflation is a much more dangerous threat than a possible return to soaring inflation, like we saw during the two oil crises. A further rate cut by the ECB therefore seems almost inevitable. But there is doubt about the effectiveness of negative interest rates, so Mr Draghi may decide to take more extensive measures. Just a few months after winding down the asset purchase programme, he may have to reverse course and reach back into his toolbox of unorthodox monetary policy. This may well be his farewell gesture before handing the reins over to Ms Lagarde, although she’s unlikely to stray too far from the course he has set.

Central banks around the world have long forgotten the dogma of days gone by and are likely to keep printing money. But as monetary policies prove less effective, it is probably time to bring in fiscal stimulus as well, especially in countries with a surplus to invest, like Germany. Christine Lagarde will soon take over responsibility for the euro, whose ongoing existence is owed in part to Draghi’s efforts at the most critical point in its history.

USA – a widening gap between invest-ment and spending

Although the trade war is still causing uncertainty, US economic fundamentals had some surprises in store last week. Manufacturing output once again declined in August, with the manufacturing ISM dropping below the 50 mark for the first time since 2016. Economists had expected output to level off, like in other regions of the world. But if the US economy is struggling, how is it that the stock markets are holding up so well?

The answer can be found in US consumers. Various indicators suggest that they are the ones keeping the US economy afloat, especially since capex has also retreated. With so much political and economic uncertainty, companies are finding it hard to think about growth and spending. Will companies also hold off on creating more jobs until they have more clarity about the outcome of the trade war?

Last Friday’s employment figures, which fell short of analysts’ expectations, suggest they might. While that may not hurt consumer confidence, it could well prompt the US Federal Reserve to cut rates for the second time this year at its meeting next week, which would prolong this period of expansion. The question is by how much: 25 basis points or 50?

To go deeper


Ce site contient des informations relatives à un grand nombre de fonds de placement enregistrés et gérés dans différentes juridictions. Les informations de ce site web ne sont pas destinées aux personnes relevant de juridictions dans lesquelles (en raison de la nationalité des personnes, de leur lieu de résidence ou pour toute autre raison) la diffusion ou l’accès à ce site est interdit. Les personnes soumises à de telles restrictions locales ne doivent pas accéder à ce site web.
Les informations publiées sur ce site ne constituent ni une sollicitation ni une offre, ni une recommandation d’achat ou vente ou de toute autre transaction sur des instruments de placement.

Même si ce site reprend une large sélection de fonds à disposition, il n’englobe pas tous les fonds actuellement disponibles sur le marché. Dès lors, il peut exister des fonds correspondant mieux aux besoins de placement de l’utilisateur, mais qui ne figurent pas sur ce site. L’utilisateur doit être conscient du fait que les prix des parts de fonds de placement peuvent fluctuer vers le haut et vers le bas. En conséquence, la performance passée n’est pas une garantie de la performance future. Par ailleurs, les placements en devises différentes sont sujets aux fluctuations des taux de change.
Avant d’effectuer tout investissement dans un placement collectif, l’utilisateur doit lire impérativement et attentivement les prospectus de vente et les informations clés pour l'investisseur (KIID). Les prospectus et KIIDs des fonds sur ce site sont disponibles sur ce site, mais peuvent également être demandés gratuitement, auprès de Piguet Galland & Cie SA ou de la direction de fonds. L’utilisateur s’engage à lire les clauses de non-responsabilité relative à chaque fonds avant d’effectuer un placement.

Les membres du conseil d’administration ou les collaborateurs de Piguet Galland & Cie SA peuvent détenir ou avoir détenu des participations ou des positions dans les fonds considérés ou peuvent être actifs ou avoir été actifs en tant que teneurs de marché pour ces titres. Par ailleurs, les membres du conseil d’administration ou les collaborateurs de Piguet Galland & Cie SA peuvent entretenir ou avoir entretenu des relations avec les sociétés concernées, peuvent offrir ou avoir offert des services de financement d’entreprise ou autres à ces sociétés ou peuvent siéger ou avoir siégé dans leur comité directeur.
Veuillez préalablement prendre connaissance des Conditions d'Utilisation du Site.

Maecenas consequat purus orci, nec bibendum massa lobortis imperdiet. Vestibulum vel urna efficitur, hendrerit felis sed, interdum enim. Aenean aliquet urna libero, eu posuere arcu volutpat eu. Pellentesque ut metus imperdiet, consequat velit sed, egestas augue. Interdum et malesuada fames ac ante ipsum primis in faucibus. Praesent convallis neque vitae tempor volutpat. Maecenas scelerisque semper dolor id cursus. In vitae justo in eros ornare hendrerit et id tellus. Suspendisse posuere nisl non consectetur consequat. Morbi egestas nunc et nisl dapibus, a consectetur lacus lacinia. Etiam feugiat ante eget luctus varius. Curabitur rutrum, velit eget molestie molestie, ipsum arcu ornare tortor, faucibus congue arcu est eu risus. Sed ut tellus dui. Phasellus feugiat quis ligula eu pretium.

Personal informations
Nos services n'étant disponibles qu'aux résidents suisses, le choix du pays de domicile n'est pas disponible.
You must accept the terms of use.
* required fields