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The Editor's selection of ARX posts discussing the impact of the coronavirus COVID-19 pandemic on the markets and the global economy.


Introduction

The impact of the coronavirus COVID-19 pandemic on the global markets and the world's economy is difficult to assess, but there is no doubt it will be felt in most economies and sectors for a long time. While the situation changes fast, investment managers must keep abreast of news, analyses and forecasts. We present a selection of relevant ARX posts that shed light on the economic effects of the pandemic. 


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Navigating Personal Finance during the Coronavirus Pandemic

The government of Malaysia implemented a six-month moratorium on loan repayments and cash transfers, to protect its citizens from the impact of Covid-19 on the country’s economy. What are its implications for personal finance?

11 September 2020 | Mohd Sedek Jantan, Tiong Lih Joe, Abdul Aqil Abdul Rashid, Nurul Anis Abdul Halim, Lim Yit Xiang

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VIDEO: How Does Passive Investing Work in Uncertain Times?

Can active managers protect investments in the time of crisis? S&P DJI’s Brent Kopp and Berlinda Liu take a closer look at the impact of Covid-19 on the performance of active and passive investments.

8 September 2020 | S&P Dow Jones Indices: Brent Kopp, Berlinda Liu | Video: 7 min.

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WEBINAR: Covid-19 - A Disconnect between the Stock Market and the Economy?

Has the Covid-19 pandemic caused a disconnect between the real economy and the stock market? What are the real forces that are driving Malaysia's market now?  

20 August 2020 | CFA Society Malaysia: Woon Khai Jhek, CFA, Jaccob Thomas, CF, Shu Heng Chuan, CFA, Phua Lee Kerk, CFA | Video: 1 hr 15 min.

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WEBINAR: Covid-19 and Its Impact on the Investment Management Industry: Presentation to CFA Society Pakistan

CFA Institute surveyed its global membership to analyze the effects of the current economic crisis caused by COVID-19 on the global economy. Mary Leung, CFA, head of advocacy, APAC, CFA Institute presented results of the survey specific to Pakistan.

6 August 2020 | CFA Society Pakistan | Video: 1 hr 7 min.

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Covid-19 in ASEAN-5: Policy Response Provides Some Support

The support packages vary in scale and scope, and are largely contingent in nature. While they will broadly help reduce some of the negative effects of the crisis, they will not offset the rising recessionary or credit risks for most sectors.

25 June 2020 | Moody's Investors Service

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Bangladesh Banking Sector Report

Banks in Bangladesh were already struggling with a challenging environment before Covid-19 struck. The pandemic is worsening the impact of recent policy measures, creating an ill-timed double whammy of lending/deposit rate cap and legacy high NPLs.

8 July 2020 | Asian Tiger Capital Partners: Md. Nafeez Al Tarik, CFA, FRM; Shohana Ahmed; Saad Niamatullah; Tofayel Ahamed

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Impairment of Assets and Liabilities during the COVID-19 Crisis

As the Covid-19 pandemic continues to spread, companies find it hard to forecast revenue and to evaluate assets and liabilities. Many have delayed the publication of financial statements. What disclosures are needed in this unprecedented situation? Notes from a Digital Reporting Workshop for Japanese investors.

27 May 2020 | Chie Mitsui

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Impact of COVID-19 on USD Corporate Bond Liquidity

The COVID-19 crisis has impacted asset valuations, increased volatility and led to reduced liquidity in many cases. In this paper, FTSE Russell examines the effects of the crisis on the  liquidity of USD corporate bonds.

30 June 2020 | FTSE Russell: Mikhail Bezroukov,  Yu Zou 

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Growth vs Value Investing on the Bursa Malaysia during Covid-19 Pandemic

Performance of 885 stocks listed on the Bursa Malaysia is analysed based on their Price to Earnings (PE), Price to Book (PB), Dividend Yield (DY), and Debt to Equity ratio (DE), during the Covid-19 pandemic from January to early June 2020.

30 June 2020 | Shu Heng Chuan, CFA, Jaccob Thomas, Lim Yik Yin

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The Only Game in Town: Assessing Monetary Policy Tools in Response to COVID-19

As the Philippine central bank implements monetary actions to cushion the economic impact of the Covid-19 pandemic, what is the effect of these policy tools on the real economy? What other policy actions should the bank introduce?

29 June 2020 | Miguel N. Sevidal

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COVID-19 Impact on Bangladesh Economy

Like in most other nations, the outbreak of COVID-19 pandemic is an unprecedented shock to the Bangladesh economy. The report explores the possible impact of the ongoing pandemic on the broad economy and major industries of the country. 

22 June 2020 | LankaBangla Asset Management Co. Ltd.

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The Impact of Covid-19 on Global Bond Markets

FTSE Russell's fixed income research specialist Robin Marshall provides insight into fixed income markets and the Covid-19 shock, with a deeper dive into  emerging market sovereigns.

5 May 2020 | FTSE Russell: Robin Marshall

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The 2008 Global Financial Crisis and COVID-19 Pandemic: How Safe Are the Safe Haven Assets

This paper compares the performance of safe haven assets during the 2008 GFC and COVID-19 pandemic across the ten largest economies. The results show that gold acts a safe haven during the 2008 GFC but fails to serve as a safe haven during COVID-19.

1 May 2020 | Muhammad A. Cheema, Kenneth R. Szulczyk

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Has COVID-19 Led to Financial Instability in China?

The COVID-19 crisis follows turbulent two years for China’s economy. Fiscal and monetary support measures have maintained stability in the banking sector and capital markets, but risks remain in small banks, real estate and export-focused industries.

30 April 2020 | Seafarer Capital Partners, LLC: Nicholas Borst

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Bangladesh and Global Macro Update: Unsustainable Divergence between US Stocks and the Economy

Massive collapse of demand from key export market economies as they contract will keep Bangladesh production limited and maintain pressure on job- and wage-cuts. US shows a massive bifurcation between tech winners and retail, travel, energy sectors. 

28 April 2020 | Asian Tiger Capital Partners (BD) Limited: Ifty Islam

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How Have Factors in Asia Reacted to COVID-19?

An examination of factor rotation and volatility in Asian stocks in response to COVID-19 shows that markets reacted with a substantial delay to the coronavirus threat. The analysis use factor volatilities as defined by the Axioma Asia risk model.

23 April 2020 | FTSE Russell: Marlies van Boven, PhD

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COVID-19’s Impact May Be More Profound and Prolonged than Expected

As the COVID-19 crisis continues to wreak havoc across global economies, the pandemic’s impact on China may be more profound and prolonged than earlier expectations suggested.

22 April 2020 | Pengyuan International: Tony Tang, Stanley Tsai

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Bangladesh Macro Update: Global Depression Risks Grow

The risks of a global depression along the lines of the 1930s are growing. Added to Coronavirus exit strategy uncertainties, we believe that consumer and business confidence will remain fragile after lockdowns are eased.

14 April 2020 | Asian Tiger Capital Partners (BD) Limited: Ifty Islam

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Global Panel: COVID-19 Implications: Navigating New Realities in Today's Connected Markets

The global pandemic has shocked the world and impacted every aspect of our lives, leading to drastic economic disruption. To provide insight in these uncertain times, CFA Institute convened a special online panel discussion.

16 April 2020 | Jack Ablin, CFA; Nicholas J. Colas; Meredith Sumpter; Lauren Foster; CFA Institute | Video: 1 hr 17 min.

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Impact of Covid-19 on Malaysian Financial Institutions and How to Respond

With the regulatory measures announced by BNM and statements issued by IFRS in response to the recent development of COVID-19, we explore its impact on Financial Institutions in Malaysia in terms of loan growth, earnings, provision, and liquidity.

13 April 2020  | Deloitte: Justin Ong CFA, Dr Chee Wei Yen, Su Je Hui CFA

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WEBINAR: Corona Financial Crisis: Is This Time Different?

Dr. Duvvuri Subbarao, 22nd Governor of the Reserve Bank of India discusses the impact of Covid-19 on India’s economy. The moderator is Dr. Samiran Chakraborty, Managing Director and Chief Economist for India at Citigroup.

13 April 2020 | Dr. Duvvuri Subbarao, Dr. Samiran Chakraborty, CFA Society India | Video: 1 hr 18 min.

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Why Have Chinese Equities Outperformed in Q1, 2020?

Despite the distinction of being the initial epicenter of the now global coronavirus outbreak, China's equity market suffered far less than both the emerging and developed indexes in the March downdraft and for the year so far.

9 April 2020 | FTSE Russell: Philip Lawlor

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Bangladesh Coronavirus Update: Unprecedented Macro Challenges Require Unconventional Policy Measures

This report lays out how the COVID-19 pandemic is likely to affect the Bangladesh economy and offers a series of policy recommendations for the government to tackle the fallout of the crisis.

6 April 2020 | Asian Tiger Capital Partners (BD) Limited: Ifty Islam

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The Impact of the Coronavirus on Capital Markets in Pakistan

Credit conditions are under stress and this will impact credit quality of many entities and sectors. In this context, PACRA aims to provide analysis on how the ongoing outbreak of COVID-19 may impact the capital markets in Pakistan.

3 April 2020 | The Pakistan Credit Rating Agency Limited: Madiha Sohail

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WEBINAR: Bank Negara Malaysia’s Pandemic Relief Measures: A Welcomed Move to the Malaysian Banking Industry?

A discussion of the measures implemented by Bank Negara Malaysia to support the efforts of banking institutions to assist individuals, small and medium-sized enterprises and corporations in managing the impact of the Covid-19 outbreak. A webinar presented by CFA Society Malaysia.

2 April 2020 | Yue Xiang Teng, Justin Ong, CFA | Video: 1 hr 26 min

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Coronavirus (COVID-19) Impact and Risk Response Guide

This guide aims to provide insights into the impact of COVID-19. It gives general risk response guidance for companies to consider when deploying business continuity planning measures to combat the epidemic.

30 March 2020 | BDO: Ricky Cheng

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Guesstimating Unemployment in China

What is the real unemployment picture in China? Data analysis suggests that even though work resumption in big cities continues as COVID-19 infections ebb, urban unemployment is surging and will get worse. 

30 March 2020 | BOCOM International: Hao Hong, CFA

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WEBINAR: Bushfires and Coronavirus: Impact on Australian Credits and Economy

A webinar discusses the aftermath of the Australian bushfires on various sectors and the effect of the global spread of the coronavirus. The combination of the two is one of the worst "black swan" events of our time.

27 March 2020 | Fitch Ratings: Jeremy Zook, Tim Roche, Kanishka de Silva | Video: 35 min.

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全球疫情和美元荒背景下中资美元债风险

随着新冠疫情在全球快速蔓延,众多行业瞬间停摆,全球经济正在面临二战以来最严重的衰退。金融和经济密不可分,全球金融体系也正遭遇雷曼危机以来的最大冲击,欧洲和美国股市已经分别暴跌40%和30%,但金融体系面临的真正挑战,是如何应对由于经济停摆所造成的流动性短缺、急剧上升的违约风险和对信贷资源的挤兑。

27 March 2020 | 野村证券中国首席经济学家 陆挺 CFA, 野村证券中国经济学家 王立升

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China's Wealth Management Regulations Likely to Be Postponed

Industry analysts anticipate that the Chinese regulators will take an accommodative approach in pushing through reforms in the wealth management product market in the remainder of 2020 as COVID-19 continues to wreak havoc across the economy.

27 March 2020 | Pengyuan International: Stanley Tsai, Tony Tang

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Insights into the Economic Consequences of the Covid-19 Epidemic: ACCA Economic Briefing

The measures introduced by governments to slow the spread of COVID-19 are having a dramatic effect on economic activity. As the global economy is heading into a severe recession, ACCA’s chief economist, Michael Taylor, presents latest insights.

24 March 2020 | ACCA: Michael Taylor

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Coronavirus and Oil Price Shock Magnify Weaknesses in Negative 2020 Outlook

Shocks of the coronavirus outbreak and the sharp fall in oil prices are exposing sovereigns' vulnerabilities: lower GDP growth and fiscal strength, deeper vulnerability to investor sentiment shifts,  wider weaknesses in key institutions.

20 March 2020 | Moody's Investors Service: Sarah Carlson, Marie Diron

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ESG Evaluation of SSE 50 Index Constituent Stocks on Epidemic Control

An analysis of a company’s behavior under an emergency such as the COVID-19 epidemic helps evaluate its resilience. The ESG Epidemic Control Valuation model developed by SynTao Green Finance serves as a supplement to the overall ESG assessment.

20 March 2020 | SynTao Green Finance

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Coronavirus and Oil Price Shocks: Managing Ratings in Turbulent Times

The rapid spread of the coronavirus, deteriorating economic outlook, lower oil and asset prices have severe, extensive and unprecedented credit effects across many sectors, regions and markets.

17 March 2020 | Moody's Investors Service: Anne Van Praagh, Marie Diron

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Fighting COVID-19, Chinese Style

As the world fights COVID-19, governments’ resolve and monetary easing will induce technical rebound in the near term, although the market will probably retest its prior low. But the longer-term economic outlook is turning increasingly clouded.

15 March 2020 | BOCOM International: Hao Hong, CFA

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Measuring Coronavirus Impact on China from the Sky

MioTech uses satellite imagery to find proxy variables of economic activities in China. Inspecting land surface temperature and nitrogen dioxide emissions makes it possible to estimate the impact of COVID-19 on economic activities in China.

13 March 2020 | MioTech: Jason Tu, Gingery Jin, Maya Li

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Coronavirus (COVID-19) - What it Means For Investors

Market fear over escalating global spread of coronavirus has seen a sell-off across many asset classes. The Australian market moved ahead of overseas markets in response to the outbreak. What does it mean for investment portfolios?

13 March 2020 | Perpetual Limited: Kyle Lidbury | Video: 7 min

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Business Challenges and Considerations for the COVID-19 Outbreak

As COVID-19 impacts business activities, the Association of Chartered Certified Accountants (ACCA) has conducted a survey of its members in Mainland China and Hong Kong SAR to understand the challenges companies face as a result of the epidemic.

9 March 2020 | ACCA Global: Eunice Chu, Yuki Qian

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WEBINAR: Coronavirus Contagion – A Market Assessment

In this webinar, Philip Lawlor, managing director, global markets research discusses the impact of the coronavirus on market returns and gauges its effect on the global economy, the credit cycle and market drivers, such as profits and valuations.

5 March 2020 | FTSE Russell | Video: 26 min.

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COVID-19: Chinese Local Government Creditworthiness Risks Mounting

Chinese local governments’ budgetary deficits are likely to rise to an all-time high in 2020 amid slower economic growth and additional fiscal stimulus measures. The COVID-19 epidemic is likely to hurt Hubei’s economy the hardest.

4 March 2020 | Pengyuan International: Jameson Zuo, Li Hu, Tony Tang

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对当前疫情影响下中国金融市场情况浅析

本⽂旨在利⽤⾦融市场数据分析和总结新冠病毒对中国股票市场,债劵市场及外汇市场带来的短期波动。 疫情发⽣以来中国⾦融市场包括债券市场、股票市场、外汇市场运⾏都是⽐较稳定的,⾦融机构运⾏正常,我们可以发现中国⾦融体系在应对⻛险⽅⾯具备较强韧性。从⾦融市场的运⾏情况也可以看到,投资者对于这次疫情认为是阶段性的,不会影响经济⻓期向好的基本⾯。同时,疫情过后经济还会出现补偿性的增⻓。 本⽂不构成任何投资建议。

1 March 2020 | Jiahui Tao

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Impact of COVID-19 on China A-Shares’ Supply Chains

China is at the centre of the world’s production needs. As the country continues to grapple with containing the contagion, production lines remain quiet, factories remain shut, and millions of workers are either displaced or restricted in movement.

29 February 2020 | MioTech: Jason Tu, Cara Liu, Maya Li

Download PDF: < English > < Chinese >


March Marks a Critical Point for China’s Economy

The full-year impact of the COVID-19 epidemic on China’s economy may be determined by the country’s economic activity in March. An analysis of three possible scenarios informs the views on individual corporate sectors for the remainder of the year.

26 February 2020 | Pengyuan International: Tony Tang, Stanley Tsai, Ke Chen 

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COVID-19 Tests the Liquidity of Chinese Property Developers

The suspension of property sales in China will pressure developers’ liquidity in the short term and squeeze their profitability in the medium term. Their credit profiles will diverge, with small developers seeing their credit profiles deteriorate.

26 February 2020 | Pengyuan International: Winnie Guo, Xinping Lin, Simon Lee

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China’s Passenger Car Shipments Likely to See Further Drop Due to COVID-19

China’s demand for cars will shrink in the short term due to the COVID-19 epidemic. Factories need time to resume operations. The downturn in the car manufacturing industry will continue to affect the companies' credit profiles.

26 February 2020 | Pengyuan International: Danny Chen, Tian Shan, Zhang Weiya

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WEBINAR: Coronavirus - Refinancing Risks for Chinese Corporates

This webinar assesses the refinancing risk posed by the coronavirus (COVID-19) epidemic and identifies Chinese corporates that face elevated risk in relation to their capital market debt maturities.

24 February 2020 | Fitch Ratings: Buddhika Piyasena, Matt Jamieson, Kalai Pillay, Ying Wang, Adrian Cheng, Laura Zhai, Kelvin Ho | Video: 46 min.

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The Coronavirus Epidemic: Implications for Markets

The economic and market impacts of coronavirus may be much larger than those of the 2003 SARS virus. Why? China is a much bigger part of the global economy than it was 17 years ago.

12 February 2020 | MSCI: Zhen Wei, Head of China Research; Jun Wang, Vice President Equity Factor Modeling Research; Thomas Verbraken, Executive Director Risk Management Solutions Research

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Turning Point of the COVID-19 Epidemic: The Economic Cost of Quarantine

The coronavirus epidemic is at a turning point. The impact of the quarantine on the economic growth is slightly greater than our previous estimate. The distance between 2,500 and 2,685 is different for each trader.

10 February 2020 | BOCOM International Holdings Company Limited: Hao Hong, CFA

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Impact of the COVID-19 Outbreak on China's Market and Economy (PDF)

China’s introduction of measures to maintain stability has eased the bearish sentiment, as the market experienced a technical rebound after the sharp fall in the early February. Yet long-term forecasts predict GDP to fall below 6% in 2020.

7 February 2020 | BOCOM International Holdings Company Limited: Hao Hong, CFA

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About the Author(s)

ARX Editorial Team

Director: Scott Lee
Content manager, Editor: Piotr Zembrowski, CFA
Coordinator: Natalie Yiu