Der Black Friday beginnt jetzt! Holen Sie sich 60% RABATT auf InvestingProJETZT ZUGREIFEN

DGAP-News: Silvia Quandt & Cie. AG, Merchant & Investment Banking: In-between the lines - Bernhard Eschweiler (deutsch)

Veröffentlicht am 02.11.2011, 10:30
Aktualisiert 02.11.2011, 10:32
Silvia Quandt & Cie. AG, Merchant & Investment Banking: In-between the lines - Bernhard Eschweiler

DGAP-News: Silvia Quandt & Cie. AG, Merchant & Investment Banking /

Schlagwort(e): Sonstiges

Silvia Quandt & Cie. AG, Merchant & Investment Banking: In-between the

lines - Bernhard Eschweiler

02.11.2011 / 10:30

---------------------------------------------------------------------

- EU summit outcome is a step forward but not the final breakthrough

- ECB likely to continue bond purchases

- Global business cycle patterns are diverging again

The drama and confusion leading to this week's EU summit had the potential

to drive financial markets into a tail spin. Instead, markets rallied.

The Dax, for example, rose 27% since its September low. Markets were not

betting on a miracle, but correctly expected that policy would make a move.

The outcome of this week's summit is a step forward but not the final break

through. Greece's solvency problem remains unresolved; the bank

recapitalization drive seems muddled and efforts to increase the impact of

the EFSF may not yield as much as hoped. Having said that, it would be

naïve to expect a swift resolution given the complexity of the matter and

the difficulty to keep all players on board. Thus, muddling through will

continue and the ECB will reluctantly keep buying governments bonds. The

market recovery was also helped by expectations being sufficiently beaten

down and some economic news coming in better than expected, notably from

the US and China.

Muddling through to continue

The outcome of last night's summit contained no major surprise. In fact,

the wording of the statement was vague in some areas and many details were

missing. It would be unrealistic to expect much more, but it is similarly

unrealistic to view this as the final breakthrough.

- Greece debt restructuring: Greece will receive the 6th disbursement of

the EU-IMF support program. Banks also agreed to a 50% haircut of

their Greek government bond holdings. However, bonds held by banks

account for only about a third of Greek government debt. Effectively,

Greek government debt will be lowered by just a sixth from currently

165% of GDP to just below 140% of GDP. At that level and given the

poor shape of the economy, Greece has no chance to get out of the debt

trap. More debt reductions will be necessary and since an outright

default is to be avoided, the next candidate to make concessions is the

Troika of EU, ECB and IMF. Already, the Troika holds about a third of

Greek government debt and by the end of next year will hold more than

half. Although inevitable, the Troika will try to delay the

restructuring of its own Greek debt holdings as long as possible.

First, to maintain pressure on Greece to implement reforms. Second, to

avoid that other crisis countries like Portugal would seek a debt

restructuring as well. Thus, the solvency problem remains unresolved

and the run-up to each future disbursement of the EU-IMF support

program is set to be bumpy.

- Bank recapitalization: Banks are required to hold an increased core

capital ratio of 9% by June 30th 2012. The additional capital needed

to attain the higher ratio is estimated to exceed EUR100 billion.

Unfortunately, there are little details on asset categorization and

valuation, which leaves plenty of room for manipulation and disputes.

National regulators together with the EBA are supposed to enforce the

implementation and make sure that banks do not deleverage and continue

to provide sufficient credit to the real economy (good luck!). Banks

are to use private sources of capital first and cut down on dividend

and bonus payments. If that is not sufficient, national governments

should help. And if that support is not available the EFSF should

provide capital. The process is too muddled, lacks guidelines and

leaves too much uncertainty. Moreover, the timeline is too short for

realistic implementation, yet too long to have a credible impact on

markets. A US-style forced recapitalization would have been much less

complex and more effective.

- EFSF leverage: The use of the word 'leverage' is misleading. The idea

is not to risk more funds than the EFSF has currently at its disposal,

but to spread the funds wider by providing partial guarantees

(20%-to-25%) for new sovereign bond issues or special purpose vehicles

instead of full guarantees as has been the case so far. The plan seems

clever but critically depends on investor sentiment. Partial

guarantees work well when investors are optimistic and just need a bit

more encouragement to take some extra risk. The plan is not designed

for countries under EU-IMF care, but may become an option for Ireland

at some point. Ireland has made the most reform progress and markets

are starting to take notice. Investors may also turn more optimistic

on Spain, if it continues to make reform progress. The biggest

potential user of the partial guaranty program as well as worry,

however, is Italy. First loss guarantees of 20%-to-25% may not be

enough to entice investors into Italian bonds at sufficiently lower

yields unless the government builds a more credible reform track

record.

- Bond purchase program: It will take some time until the partial

guaranty program works, if at all. Until then, the focus will be on

stabilizing secondary markets. The plan is for the EFSF to replace the

ECB as market stabilizer. In practice, the EFSF lacks both funds and

skills to replace the ECB effectively. Thus, the ECB will probably

continue its bond purchases, as incoming President Draghi has already

hinted.

Fear of global recession fading

The initial driver of the market downturn last summer was the growing fear

of a global recession. At center stage was the US, which had already

slowed sharply and was at risk to slip into recession in the second half of

the year. The fear was compounded by the problems in Europe and a growing

concern that China may experience a hard landing. That picture is

changing. Strong production and sales figures through September point to a

bounce in third-quarter US growth. Moreover, forward looking indicators,

such as the regional PMIs for October show that sentiment has stabilized

and is even improving a bit. The prospect of more fiscal tightening keeps

consumer sentiment depressed, but the risk of that turning into recession

is declining. China's flash PMI has made a big jump in October, after

already inching higher in September. The government is also gradually

shifting focus from inflation fighting to growth promotion, as highlighted

in recent statements by President Hu and Premier Wen.

In contrast, economic prospects in Europe have not yet improved. The

October PMI for the Euro area fell again. Greece and Portugal are in

recession and Italy and Spain

are set to follow. The region as a whole may just avoid recession, but the

Euro area will find itself at the bottom of the global growth league. That

is nothing new, however. The Euro area has been an underperformer for most

of the last two decades, a fact that has not much harmed the rest of the

world.

Looking through Germany's seesaw pattern

Within the Euro area, not all is marching to the same beat either.

Third-quarter growth in Germany is likely to come in stronger than

expected. The production surge in July, which was partly due to special

calendar effects, was only modestly reversed in August. And even if there

is more payback in September, Q3 production probably rose 10% annualized

from Q2. However, the partly technical bounce in Q3 will probably be

followed by negative payback in Q4, similar to the pattern seen between Q1

and Q2. On average, growth in 2010 will reach 3% and possibly a touch

more. Looking through the quarterly seesaw pattern, momentum clearly

slowed in the second half, but stayed firmly in positive territory. That

is consistent with the moderation of the IFO survey. Business sentiment

will have to drop a lot more than the rather modest decline in October, if

the economy is to experience a hard landing. Given a less favorable Q4

base effect and the possibility for a soft start in Q1, we have lowered our

2012 growth forecast to 1.5%, but expect that the underlying momentum will

return to the 2+% growth potential in the Spring next year.

Disclaimer

This analysis was prepared by Bernhard Eschweiler, Senior Economic Advisor,

and was first published 2 November 2011, Silvia Quandt Research GmbH,

Grüneburgweg 18, 60322 Frankfurt is responsible for its preparation. German

Regulatory Authority: Bundesanstalt für Finanzdienstleistungsaufsicht

(BaFin), Graurheindorfer Str. 108, 53117 Bonn and Lurgiallee 12, 60439

Frankfurt.

Publication according to article 5 (4) no. 3 of the German Regulation

concerning the analysis of financial instruments (Finanzanalyseverordnung):

Number of recommendations Thereof recommendations for issuers to which

from Silvia Quandt Research investment banking services were provided

during

GmbH in 2011 the preceding twelve months

Buys: 99 37

Neutral: 38 1

Avoid: 6 0

Company disclosures

Article 34b of the German Securities Trading Act (Wertpapierhandelsgesetz)

in combination with the German regulation concerning the analysis of

financial instruments (Finanzanalyseverordnung) requires an enterprise

preparing a securities analysis to point out possible conflicts of interest

with respect to the company or companies that are the subject of the

analysis. A conflict of interest is presumed to exist, in particular, if an

enterprise preparing a security analysis:

(a) holds more than 5 % of the share capital of the company or companies

analysed;

(b) has lead managed or co-lead managed a public offering of the

securities of the company or companies in the previous 12 months;

(c) has provided investment banking services for the company or companies

analysed during the last 12 months for which a compensation has been or

will be paid;

(d) is serving as a liquidity provider for the company's securities by

issuing buy and sell orders;

(e) is party to an agreement with the company or companies that is the

subject of the analysis relating to the production of the recommendation;

(f) or the analyst covering the issue has other significant financial

interests with respect to the company or companies that are the subject of

this analysis, for example holding a seat on the company's boards.

In this respective analysis the following of the above-mentioned conflicts

of interests exist: none

Silvia Quandt Research GmbH, Silvia Quandt & Cie. AG, and its affiliated

companies regularly hold shares of the analysed company or companies in

their trading portfolios. The views expressed in this analysis reflect the

personal views of the analyst about the subject securities or issuers. No

part of the analyst's compensation was, is or will be directly or

indirectly tied to the specific recommendations or views expressed in this

analysis. It has not been determined in advance whether and at what

intervals this report will be updated.

Equity Recommendation Definitions Silvia Quandt Research GmbH analysts rate

the shares of the companies they cover on an absolute basis using a 6 -

12-month target price. 'Buys' assume an upside of more than 10% from the

current price during the following 6 - 12-months. These securities are

expected to out-perform their respective sector indices. Securities with an

expected negative absolute performance of more than 10% and an

under-performance to their respective sector index are rated 'avoids'.

Securities where the current share price is within a 10% range of the

sector performance are rated 'neutral'. Securities prices used in this

report are closing prices of the day before publication unless a different

date is stated. With regard to unlisted securities median market prices are

used based on various important broker sources (OTC-Market).

Disclaimer This publication has been prepared and published by Silvia

Quandt Research GmbH, a subsidiary of Silvia Quandt & Cie. AG. This

publication is intended solely for distribution to professional and

business customers of Silvia Quandt & Cie. AG. It is not intended to be

distributed to private investors or private customers. Any information in

this report is based on data obtained from publicly available information

and sources considered to be reliable, but no representations or guarantees

are made by Silvia Quandt Research GmbH with regard to the accuracy or

completeness of the data or information contained in this report. The

opinions and estimates contained herein constitute our best judgement at

this date and time, and are subject to change without notice. Prior to this

publication, the analysis has not been communicated to the analysed

companies and changed subsequently. This report is for information purposes

only; it is not intended to be and should not be construed as a

recommendation, offer or solicitation to acquire, or dispose of, any of the

securities mentioned in this report. In compliance with statutory and

regulatory provisions, Silvia Quandt & Cie. AG and Silvia Quandt Research

GmbH have set up effective organisational and administrative arrangements

to prevent and avoid possible conflicts of interests in preparing and

transmitting analyses. These include, in particular, inhouse information

barriers (Chinese walls). These information barriers apply to any

information which is not publicly available and to which any of Silvia

Quandt & Cie. AG and Silvia Quandt Research GmbH or its affiliates may have

access from a business relationship with the issuer. For statutory or

contractual reasons, this information may not be used in an analysis of the

securities and is therefore not included in this report. Silvia Quandt &

Cie. AG and Silvia Quandt Research GmbH, its affiliates and/or clients may

conduct or may have conducted transactions for their own account or for the

account of other parties with respect to the securities mentioned in this

report or related investments before the recipient has received this

report. Silvia Quandt & Cie. AG and Silvia Quandt Research GmbH or its

affiliates, its executives, managers and employees may hold shares or

positions, possibly even short sale positions, in securities mentioned in

this report or in related investments. Silvia Quandt & Cie. AG in

particular may provide banking or other advisory services to interested

parties. Neither Silvia Quandt Research GmbH, Silvia Quandt & Cie. AG or

its affiliates nor any of its officers, shareholders or employees accept

any liability for any direct or consequential loss arising from any use of

this publication or its contents. Copyright and database rights protection

exists in this publication and it may not be reproduced, distributed or

published by any person for any purpose without the prior express consent

of Silvia Quandt Research GmbH. All rights reserved. Any investments

referred to herein may involve significant risk, are not necessarily

available in all jurisdictions, may be illiquid and may not be suitable for

all investors. The value of, or income from, any investments referred to

herein may fluctuate and/or be affected by changes in exchange rates. Past

performance is not indicative of future results. Investors should make

their own investment decisions without relying on this publication. Only

investors with sufficient knowledge and experience in financial matters to

evaluate the merits and risks should consider an investment in any issuer

or market discussed herein and other persons should not take any action on

the basis of this publication.

Specific notices of possible conflicts of interest with respect to issuers

or securities forming the subject of this report according to US or English

law: None

This publication is issued in the United Kingdom only to persons described

in Articles 19, 47 and 49 of the Financial Services and Markets Act 2000

(Financial Promotion) Order 2001 and is not intended to be distributed,

directly or indirectly, to any other class of persons (including private

investors). Neither this publication nor any copy of it may be taken or

transmitted into the United States of America or distributed, directly or

indirectly, in the United States of America.

Frankfurt am Main, 02.11.2011

Silvia Quandt Research GmbH

Grüneburgweg 1860322 Frankfurt

Tel: + 49 69 95 92 90 93 -0

Fax: + 49 69 95 92 90 93 - 11



Ende der Corporate News

---------------------------------------------------------------------

02.11.2011 Veröffentlichung einer Corporate News/Finanznachricht,

übermittelt durch die DGAP - ein Unternehmen der EquityStory AG.

Für den Inhalt der Mitteilung ist der Emittent / Herausgeber

verantwortlich.

Die DGAP Distributionsservices umfassen gesetzliche Meldepflichten,

Corporate News/Finanznachrichten und Pressemitteilungen.

Medienarchiv unter http://www.dgap-medientreff.de und

http://www.dgap.de

---------------------------------------------------------------------

144370 02.11.2011

Aktuelle Kommentare

Installieren Sie unsere App
Risikohinweis: Beim Handel mit Finanzinstrumenten und/oder Kryptowährungen bestehen erhebliche Risiken, die zum vollständigen oder teilweisen Verlust Ihres investierten Kapitals führen können. Die Kurse von Kryptowährungen unterliegen extremen Schwankungen und können durch externe Einflüsse wie finanzielle, regulatorische oder politische Ereignisse beeinflusst werden. Durch den Einsatz von Margin-Trading wird das finanzielle Risiko erhöht.
Vor Beginn des Handels mit Finanzinstrumenten und/oder Kryptowährungen ist es wichtig, die damit verbundenen Risiken vollständig zu verstehen. Es wird empfohlen, sich gegebenenfalls von einer unabhängigen und sachkundigen Person oder Institution beraten zu lassen.
Fusion Media weist darauf hin, dass die auf dieser Website bereitgestellten Kurse und Daten möglicherweise nicht in Echtzeit oder vollständig genau sind. Diese Informationen werden nicht unbedingt von Börsen, sondern von Market Makern zur Verfügung gestellt, was bedeutet, dass sie indikativ und nicht für Handelszwecke geeignet sein können. Fusion Media und andere Datenanbieter übernehmen daher keine Verantwortung für Handelsverluste, die durch die Verwendung dieser Daten entstehen können.
Die Nutzung, Speicherung, Vervielfältigung, Anzeige, Änderung, Übertragung oder Verbreitung der auf dieser Website enthaltenen Daten ohne vorherige schriftliche Zustimmung von Fusion Media und/oder des Datenproviders ist untersagt. Alle Rechte am geistigen Eigentum liegen bei den Anbietern und/oder der Börse, die die Daten auf dieser Website bereitstellen.
Fusion Media kann von Werbetreibenden auf der Website aufgrund Ihrer Interaktion mit Anzeigen oder Werbetreibenden vergütet werden.
Im Falle von Auslegungsunterschieden zwischen der englischen und der deutschen Version dieser Vereinbarung ist die englische Version maßgeblich.
© 2007-2024 - Fusion Media Limited. Alle Rechte vorbehalten.