European economy in the slow lane, the future of work, and China’s re-balancing act

Alister Sneddon, CTO

Here are the top 3 insights for May 8th, prepared by Alister, our CTO.

Today’s Brief

  • S&P Global: The European Economy Lurches Ahead — In The Slow Lane
  • Deloitte: The future of work
  • Franklin Templeton: China’s Re-Balancing Act

The European Economy Lurches Ahead — In The Slow Lane

  • The eurozone economy is shaking off weakness from a drop in external demand and domestic one-off effects in late 2018.
  • As a result, we have lowered our forecasts for eurozone growth to 1.1% for 2019 — but believe GDP growth should move back to trend and rebound to a 1.4% rate in 2020 and 2021.
  • The domestic economy remains the engine of growth. The labor market has not run out of steam despite the slowdown in activity.
  • Because the European Central Bank has put off monetary policy normalization, borrowing costs will stay lower for longer.

Genuine Scores for the top 3 EuroZone focused funds

  • UBS ETF MSCI EMU hedged to USD, 61
  • UBS ETF — MSCI EMU Socially Responsible ETF, 44
  • iShares Euro Dividend UCITS ETF, 31

The future of work

  • It is estimated that in five years, 95 percent of customer interactions will be AI-driven.
  • Nearly half (47 percent) of US jobs could be automated in the next 10 years.
  • Over the past five years, freelancers, gig workers, and contractors made up 94 percent of net new job growth.
  • Millennials currently make up almost 50 percent of the work mix and are expected to account for nearly 75 percent of the overall US workforce by 2025.
  • As baby boomers extend productive life through healthy practices, the notion of the “100 year life” has implications for careers extending from 30 years to 50 years.

Genuine Scores for top 3 Health Care stocks

  • McKesson, 66
  • Innoviva, 65
  • Molina Healthcare, 63

China’s Re-Balancing Act

  • Measures announced at China’s 13th National People’s Congress (NPC) suggest to us that the Chinese authorities are taking the threat of an economic slowdown seriously and are prepared to act.
  • While China faces slowing gross domestic product (GDP) growth, a trade standoff with the United States and disputes over China allowing foreign companies market access in return for technology transfers, we see policymakers stepping up to the plate to readjust and rebalance targets for a more sustainable economy.

Genuine Scores for the top 3 Greater China focused funds

  • UBS (Lux) Equity Fund — Greater China, 63
  • First State Greater China Growth, 57
  • Schroder ISF Greater China, 57

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All the best,
Alister and the Genuine Impact Team

p.s. all Genuine Scores are accurate as of the 5th of April