MARKET5 final 2019_Layout 1 2/15/19 5:19 PM Page 25 Lisette WORLD Van Doorn Ruchir “Sentiment is more negative on cities fac- Sharma's ing geopolitical risks” Markets Top 10 Economic Financial Markets Insights Trends To Watch p.02 Out For in 2019 Distributed Freely Monthly Edition ⎥ Volume II ⎥ Issue 05 ⎥ January 2019 P. 07 John Bogle East & SE Europe Equities The life and legacy of Vanguard’s Monthly performance reports and Analysts give their 2019 outlook on FUNDS founder p.06 statistics from the region p.02 world markets p.03 SEE STOCK EXCHANGES FORECAST GREAT TRADERS David Alan Tepper A specialist in distressed debt investing David A.Tepper was born on 11 Sep- Bond Funds. He also worked in the treasury tember 1957 in Pittsburgh, Pennsylva- department of Republic Steel. In 1985 Tepper nia, USA. He is the founder and was recruited by Goldman Sachs as a Credit D president of the wildly successful hedge Analyst. His primary focus was bankruptcies “The point is, fund Appaloosa Management which is based and special situations at the firm. Within six in Miami Beach, Florida and now manages months he became its head trader, remaining markets adapt, $15 billion. Tepper earned a Bachelor of Arts at Goldman till December 1992. He founded people adapt. with honors in economics from the University Appaloosa Management in early 1993. A 2010 Don’t listen to of Pittsburgh in 1978 and an M.B.A. from profile in New York Magazine described him Carnegie Mellon University in 1982. During as the object of “a certain amount of hero wor- all the crap college, he began small scale investing in var- ship inside the industry.” Forbes listed him as out there.” ious markets. His first two investments, given one of the 25 highest-earning hedge fund man- to him by his father, were Pennsylvania Engi- agers in 2013 and 2016. He has an estimated neering Co. and Career Academies. Both com- net worth of around $11.6 billion. Tepper's David Tepper panies went bankrupt. After graduation he statements are closely watched by traders as entered the finance industry. In 1984, he joined he is considered as one of the greatest hedge Created by Ip Keystone Mutual Funds as an Analyst for Junk fund manager of his generation. WORLD IN THE SPOTLIGHT FINANCIAL An indigestible cocktail MARKETS MONTHLY REVIEW for investors December 2018 will be remembered for its volatility and its challenges he final quarter of 2018 was a poor one down was initiated and has persisted into nificantly dented business confidence. gion, export-oriented markets Taiwan, BoE warns for equities. Investor sentiment was the New Year. On Dec.24, the Dow Prime Minister Theresa May's Brexit South Korea and China posted sharp de- that Brexit hampered by rising US central bank in- Jones Industrial Average lost more than “divorce” plan met stiff opposition in the clines. Hong Kong, Singapore and New terest rates, discouraging macroeco- 600 points, representing its worst decline British Parliament, prompting her to Zealand saw mid-single-digit declines. In uncertain- T nomic data from the EU, weaker on the session prior to Christmas in the delay a vote on the measure until January Australia, the benchmark S&P/ASX 200 ties have Chinese growth and fears of a world 122-year-old blue-chip gauge’s history. 14. The UK's FTSE 100 lost 0.09 per- Index ended 2018 lower by 6.9 percent economic slowdown. Geopolitical con- Holiday market action led to a breathtak- cent at the close on Dec .31, marking the as compared to its final close of 2017 as intensified cerns continued to weigh as well. World ing rollercoaster ride. Nonetheless, the worst year for the index since the finan- confidence in the economy faltered. financial markets opened the month major averages moved significantly cial crisis. Meanwhile in France, the Meanwhile, weak oil prices lifted some At its meeting ending on 19 De- firmly in positive territory after Trump lower for the year and posted their worst “gilets jaunes” protests surrounding the net oil importers; Indonesia, the Philip- cember 2018, the Bank of Eng- and his Chinese counterpart Xi Jinping yearly performances since the financial cost of petrol led to widespread unrest pines and India benefited. land's nine-member Monetary at the G20 summit in Argentina agreed crisis. The Dow Jones industrial average in key cities. In Eastern Europe, EMERGING MARKETS Policy Committee (MPC) voted to a temporary trade truce between the sank 5.6 percent, the S&P 500 index Bucharest stock exchange crashed on unanimously to leave interest two economic powerhouses. But as the plunged by 6.2 percent while the tech- Dec.19 after the Finance Ministry an- Emerging markets lost value. Chinese rates on hold at 0.75%. The month progressed, enthusiasm evapo- weighted Nasdaq shrunk by3.9 percent. nounced new taxes on banks, energy and equities suffered their worst quarterly de- MPC warned that Brexit uncer- rated amid conflicting signals over the Latin American stocks declined but held telecom companies. Despite data contin- cline since 2015. Turkish stocks fell more tainty is weighing on the mar- discussion between Trump and Xi. up better than other international markets, uing to point to slowing momentum in than 5 percent. Russian stocks shed over kets and is now hurting the UK thanks to gains in Mexico and Peru. the eurozone economy, the European AMERICAS 3 percent. South African stocks edged economy. "Brexit uncertainties EUROPE Central Bank ended its bond-buying lower. The MSCI Europe, Middle East, The U.S. Federal Reserve raised raised stimulus programme in December. Over- have intensified considerably and Africa Index dropped 1.57 percent. since the committee's last meet- the benchmark interest rates by 25 basis December saw the end of the long all, this quarter the MSCI Europe Index For the year, the MSCI Emerging Mar- ing," minutes from the MPC's points to between 2.25-2.50 percent, at running dispute over Italy’s controver- lost 11 percent in local currency terms kets Index shed 14.25 percent, its biggest meeting said. "The further inten- the conclusion of its mid-December sial budget proposal for 2019. Brus sels and 13 percent for dollar-based investors. annual loss since 2015. sification of Brexit uncertainties, meeting. It was the fourth time the cen- and Rome agreed to a 2019 deficit target ASIA / PACIFIC tral bank hiked key interest rates in of 2.04 percent, down from an initial tar- Concerns over US-China trade nego- coupled with the slowing global 2018. The markets struggled to manage get of 2.4 percent. Italian Prime Minister Japan was among the weakest of the tiations, fears over the outlook of the economy, has also weighed on expectations when Fed Chair Jerome Giuseppe Conte said the compromise major international markets, reflecting world economy tightening monetary the near-term outlook for UK Powell indicated the Fed expects two in- was a win for both sides. However, the the deterioration in global sentiment.The conditions and political uncertainty growth" the Bank of England terest rate increases in 2019. By Dec.18, stock markets ignored this positive devel- Japanese equity market lost 10.5 percent marked 2018 a turbulent year which added. US stocks were on track for worst De- opment as the agreement failed to quell in December and ended the quarter down will be remembered more for its losses Kyriaki I.Balkoudi Photo: Mark Carney BOE cember since the Great Depression.On concerns about the health of the country’s -17.6 percent. The MSCI Pacific ex than gains. Volatility likely will con- Governor Dec.22, a partial US government shut- banks.Political turbulence in the UK sig- Japan Index lost 7 percent. Across the re- tinue into 2019. MARKET5 final 2019_Layout 1 2/15/19 5:19 PM Page 26 2 INSIDE THE MARKETS Issue 05 ⎥ January 2019 In December 2018 the The Association of The Monetary Authority of Singa- large-cap S&P 500 Index African Stock Ex- pore (MAS) is launching a set of returned -9.03 percent changes (ASEA) wants grants worth US$55.4 million to help versus -11.32 percent for to interconnect ex- tech companies, including those USA 1 the S&P MidCap 400 2 changes on the conti- 3 ASIA from overseas, float on the Singa- NEWS AFRICA WORLD Index nent. pore Exchange (SGX). MARKETS INVESTMENT TRENDS SEE Millennials turn to Bucharest Stock Exchange automated investing drops nearly 5 percent in 2018 Investors are reacting to market volatility differently across gen- erations, according to a new survey of 1,000 U.S. investors by TD Ameritrade. TD's study found younger investors are four times more ucharest Stock Exchange (BVB) reported dividends, managed to stay on the plus side at end likely than baby boomers to consider automating investment deci- a market decline of 4.77 percent at the end of the year. The BET-TR index, which also in- B of 2018 for the BET, the blue-chip index, cludes the dividends paid by the companies in the sions while older generations still prefer to work with a financial ad- viser. Automated investing also known as online advisors or BVB data showed. The downward trend was trig- BET index, posted the largest growth. "The Ro- robo-advisors use computer algorithms and comprehensive financial gered on December 19th, after the government an- manian capital market went in the negative terri- software to provide investment services to customers. These auto- nounced plans for changes in taxation in banking, tory last year following a drop by 4.77 percent of mated investment and wealth management tools have surged in pop- energy and telecom sectors as well as pensions.