Daily Brief Macro: UK: GDP Normalisation Falls Flat in Jul-22 and more

• UK GDP rebounded by 0.2% m-o-m in Jul-22 after depressing bank holiday shifts. Merely returning to Feb-22 levels confirms that the UK economy is flatlining.
• Another new Bank holiday on 19 September will likely tip the economy into a technical recession. Surveys are also indicating increasingly broad-based contractions.
• The government’s energy price guarantee will curb the winter squeeze and the need for excessive monetary tightening. UK asset values can temporarily outperform.

• On 12 September, South Korea’s Financial Services Commission (FSC) announced significant changes to pre-disclosure of major insiders trading in Korea.
• The executives and the major shareholders of Korean companies will be required to disclose their shares transaction plans at least 30 days prior to the actual transaction date.
• The pre-disclosure of major insiders trading in Korea will have big impact on the Korean stock market including deterring large scale block deal sales.

In our next Webinar, we welcome Analyst Said Desaque, who will outline his outlook on the Asian economy and its opportunities. Is wage inflation becoming an issue for ASEAN countries? Is there the possibility of a yuan versus yen currency war? Tune in to find out more. 

The webinar will be hosted on Wednesday, 14 September 2022, 17:00 SGT/HKT.

Said DeSaque is a professional economist with over 33 years of experience covering the global economy, with significant expertise in the US, China, Japan and emerging markets. He worked with US investment banks for 25 years covering institutional investors in Europe, Middle East, Far East and Australia. Covers financial markets on a multi asset basis. Said has been an independent economist covering the global economy and financial markets for the past 8 years since founding DeSaque Macro Research in London.

• In our last post on Model Portfolios*, we considered looking at Global Equities through the lens of Factors – Momentum, Min Volatility, Value, Quality and Size.
• This allowed us to achieve diversification, while Dynamic allocation between the factors allowed us to achieve a superior risk return profile – primarily through the ability to use cash to protect the downside in times of low conviction.
• In this note, we look at how we can construct a different Global Equity Model Portfolio using the same process of Conviction Scores and Dynamic Allocation, but looking instead at a diversified portfolio through the lens of ‘Global Themes’.

• India, the world’s biggest rice shipper, restricted exports of key varieties that mainly go toward feeding Asia and Africa.
• India imposed a 20% duty on a variety of rice varieties. Keep in mind that Asia is producing and consuming about 90% of the global supply. 
• India alone is the world’s most important exporter with a share of 40%.