In many ways 2014 was a bumper year for the investment banking industry. Although the year began with a few jitters as the US Federal Reserve changed guard and began to taper its purchases of government and asset-backed securities, asset prices across the markets quickly resumed their upward march of the past five years.
They say in Hollywood that nothing dates faster than visions of the future. Those old sci-fi movies look so cheesy now because reality always outpaces our ability to predict it. And predictions for how 2014 would turn out look, in retrospect, pretty outdated indeed.
At cruising altitude; turbulence ahead?: This report reaches you at a time when Emerging Europe and Turkey could be stuck on the tarmac. The political situation means Ukraine is grounded and Russia may yet have to consider an emergency landing, yet the rest of the CEE region appears to be about to take off.
The pivotal moment - India’s capital markets are approaching a pivotal moment. After Narendra Modi’s landslide election victory earlier this year, initial enthusiasm has begun to give way to lingering doubts that the new regime can deliver on its reform agenda.
Fashion can be a cruel mistress, especially if you’re the only person to turn up at the party with platform sneakers, a tracksuit with “Juicy” scrawled across the derriere, and a green feather boa. Banks are experiencing their own fashion faux pas right now and working hard to maintain their appeal.
Playground rules - The collaborative effort of European governments and regulators is akin to children rushing around the school playground with a football. Enthusiasm and no lack of skill are undermined by issues of translation and the fierce desire of all to score the winning goal.
The bigger the better – in everything. Freddie Mercury, the late lead singer of Queen, wasn’t alone in judging the world and its wares solely on the merit of size. Take bond investors. When the Federal Reserve announced its intention to begin tapering its quantitative easing programme last May, expectations were of an inexorable rise in US yields.
As a solo performer, Germany has few rivals and many fans, striking all the right notes and rising sublimely above Europe’s discord as the DAX posts all-time highs, data show a growing economy, and unemployment dips to the lowest rate since unification.
The euro crisis is over. At least, that’s what the market appears to believe. Yields across the eurozone’s embattled periphery have fallen to levels not seen in nearly a decade, while rating agencies are starting to take a more positive outlook towards peripheral countries, citing progress in fiscal and economic reform.
IFR’s inaugural Middle East Awards, which were presented at a gala dinner in Dubai at the end of March, were a great success. Senior investment bankers and their key clients assembled in the Ritz-Carlton DIFC to celebrate a significant year in the region’s capital markets and showcase some major achievements.
The good, the bad and the downright ugly: The People’s Republic of China may be more than 10,000 miles away from Latin America, but given the influence it has been having on the region, you could be forgiven for thinking it occupies the same barrio. There’s been no bigger influence on the region’s economy over the past few years than the PRC. With China’s growth slowing to about 7.5% from the runaway double-digit peak it reached in 2010–11, it’s not surprising that LatAm has suffered similarly.
There are solid reasons to forecast a positive outlook for global capital markets in 2014. The all-time record new-issue activity seen in 2013 in areas such as US investment-grade corporate debt, US syndicated lending, global high-yield or Asian G3 debt may not necessarily be breached in the forthcoming 12 months, but it is likely to be matched as conditions in the US and across multiple market segments around the world remain highly propitious as the global economy gets into gear and funding levels remain compelling on the back of strong buyside liquidity.