Coronavirus - An Unexpected Positive Ray Of Light From The Epicentre - Inteqres

Mark Artherton, CFA

Inteqres

Thematic (Sector/Industry)

Hungary Consumer discretionary / Thematic (Sector/Industry)

<p>The closure of the Lombardy region - the powerhouse of the Italian economy - and other Italian regions has led a shockwave around the world.  We update investors with the current situation in Europe and some anecdotal stories and how the European experience will feedback into Asian economies and stocks.</p><p>There are many feedback loops to Asian stocks from Europe.  Revenue exposure of listed companies is relatively limited, but supply chains will be negatively impacted and a European slowdown or recession will have negative impacts for Asia.  A positive note may be from reduced German competition as Chinese suppliers of heavy equipment come online, for example.  However, overall we remain cautious in the near term.</p>

The closure of the Lombardy region - the powerhouse of the Italian economy - and other Italian regions has led a shockwave around the world.  We update investors with the current situation in Europe and some anecdotal stories and how the European experience will feedback into Asian economies and stocks.There are many feedback loops to Asian stocks from Europe.  Revenue exposure of listed companies is relatively limited, but supply chains will be negatively impacted and a European slowdown or recession will have negative impacts for Asia.  A positive note may be from reduced German competition as Chinese suppliers of heavy equipment come online, for example.  However, overall we remain cautious in the near term.

The European Response to COVID 19 and the Feedback Loop to Asia.