On this week’s market summary:
💡1. Deutsche Bank relied on the boom in mergers and acquisitions to offset a drop in trading revenues last quarter, as Germany’s biggest bank reported better than expected profits. Revenue from advising on deals, as well as helping companies issue new debt and equity, rose 22 per cent from the same period last year. Trading revenues dropped 12 per cent, though that decline was smaller than feared. Like most of its rivals, Deutsche’s bottom line also benefited from a steep decline in provisions for bad loans related to the pandemic. As a result, net profits at the bank rose 7 per cent in the third quarter to €194m, beating analyst expectations of €135m.
💡2. Co-living projects are delivering higher occupancy and profits for property owners, underpinning efforts to acquire and convert hotels as the hospitality industry continues to suffer from tough Covid-19 measures, according to consultants. The city could see about US$300 million worth of real estate transactions involving hotels this year, JLL estimated, with the vast majority of them earmarked for conversion into co-living purposes. The volume may increase to US$500 million next year, it said.
3. HSBC announced a $2bn share buyback and posted a 74 per cent increase in third-quarter profit, making it the latest global lender to turn bullish on the economic outlook nearly two years after the start of the pandemic. Earnings were given a big boost by a $659m release from its reserves for potential bad loans — 85 per cent of which were related to the UK — as fears about a wave of company bankruptcies faded and growth rebounded. We are seeing multiple signs the UK economy is back, citing higher credit card spending, mortgage growth and modest default rates.
4. When G20 finance and health ministers meet this week as part of the summit in Rome, health funding must be at the top of their agenda. Additional money is urgently needed to address the current pandemic and shape preparations for future threats. The leaders of the IMF, World Health Organization, World Bank and WTO have already joined together to advise that “investing $50bn to end the pandemic would pay a huge dividend in development and would boost growth and wellbeing globally.
One of the must-ask interview questions for banking and finance is: “Have you read any news recently?”, with the follow-up questions: “How would you link this news to the market and what investment suggestions would you give to your clients based on this news?”
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Showing your market sense and ability to provide feasible investment ideas would help to differentiate you from other candidates. Therefore, apart from the weekly news update / investment insights, we have also generated this Weekly Market Summary for you to have a quick understanding of the market development and tips to answer some hot discussion topics. Take a look of the summary and WhatsApp us in the group if you have questions.
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