We recently hosted market, derivatives and ETF experts from FTSE Russell, Franklin Templeton and the Singapore Exchange (SGX) in a special webinar focused on the post-Pandemic case for international equity markets and how investors might participate in these opportunities in 2021. In the webinar for clients and the news media, moderated by FTSE Russell director of derivatives strategy Ricardo Manrique, the group explored global equity market drivers at work and where investors may be best served in terms of market outlook and tools for market exposure as the “post-pandemic” story emerges.
Philip Lawlor, managing director, global investment research, FTSE Russell:
“Prior to the vaccine news flow in early November, we think markets were expecting the low end forecasts to exert a greater gravitational pull on consensus numbers. The vaccines are now reversing this pattern, attaching a higher probability to the growth forecast drifting upwards. Turning to the profit cycle, we're already starting to see signs of optimism building in the ratio of analyst upgrades to downgrades. One potential downside risk is concern that, as economies recover next year, capacity constraints could produce a rise in inflation that could in turn create fears that central banks could reverse policy and remove the punch bowl for markets.”
Dina Ting, CFA, SVP, head of global index portfolio management, Franklin Templeton:
“The current global market backdrop with large dispersions among country returns helps underscore the value of being able to allocate into specific countries to get precise exposure based on investors’ convictions. For example, we're seeing countries such as South Korea and Taiwan, which have been much better at handling the pandemic relative to other markets and have been able to physically operate businesses without too much disruption, are better positioned to capture future growth.”
Craig Cohen, head of North American sales, Singapore Exchange (SGX):
“We are seeing strong interest by US investors in index-based futures as a means of gaining country-specific market exposure to pursue upside opportunity and manage downside risk. For example, futures based on the FTSE Taiwan Index have gained traction very quickly since launching five months ago with US$7 billion outstanding positions and daily turnover exceeding US$4 billion. The futures contract is highly representative of the broad Taiwan domestic equity market while being well diversified and liquid.”
A playback of this webinar can be accessed on BrightTalk. For more information on derivatives and ETFs based on indexes from FTSE Russell, go to the FTSE Russell website.
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