The equity market beyond the pandemic

International equities were the focus of a webinar recently hosted by BOV Asset Management, whereby investment specialists discussed the ongoing sector rotation, changing economic fundamentals and the implications on investor sentiment on equities in global developed markets.

In Steve Ellul’s view, Head at BOV Asset Management, international shares economically suffered the most rapid decline there has ever been. Despite that, their recovery was also a rapid one.

“The S&P 500 Index is showing some promising leaps, such that the equity market will have brighter days in a post-pandemic new normal,” stated Mr Ellul. He claimed that the rise in the value of global stocks will ultimately depend on the profitable aspect of companies.

While the pandemic disrupted global economies, it also positively accelerated certain sectors such as technology.

Loredana Vella, Investment Specialist at BOV Asset Management, outlined the e-commerce area as one that encountered massive growth through adaptability. “E-commerce businesses identified the past year as an opportunity to strategically grasp new opportunities and be at the forefront of the ongoing digitalisation journey,” explained Ms Vella. “These entities retained high revenues by creating new demands and saving costs through remote working.”

Portfolio Managers from BOV Asset Management debated on the impact of financial assistance from banks on the performance of international markets.

Peter Paul Cilia remarked that central banks are fundamental for the recovery of many countries. “We’ve seen central banks introducing fiscal measures to provide liquidity and assure that companies retain access to financial assistance,” stated Mr Cilia. He predicts that financial support incentives are expected to continue during 2021 and possibly beyond.

Christian Buhagiar anticipated that banks create innovative products to help businesses strengthen long-term resilience. “There was an incline in the expansion of digital infrastructure such as digital banking,” claimed Mr Buhagiar. “More businesses are now seeking digital trends as a solution to adapt to the current situation.”

A recording of this webinar can be viewed on the BOV YouTube channel here.