Covid-19 business disruption expected to end in 10 months

Business activity across most sectors and regions is expected to return to a stable level within a year and grow to pre-Covid levels by the end of 2021, according to a survey of Fidelity International’s in-house analysts. This month’s survey shows growing optimism over the path of the Covid-19 outbreak, with business disruption estimated to come to an end within 10 months, according to the global average of responses.  Fiona O’Neill, director, global research, Fidelity International, said: “Against tough economic data, green shoots are starting to emerge. China is leading the recovery, with our analysts expecting a wait of just under 6 months to reach stability, a sign the country’s economic momentum is gathering pace.  “The general upbeat picture is confirmed by a noticeable jump in the proportion of Fidelity analysts seeing positive leading indicators in their sectors.” O’Neill highlighted that the energy sector has seen the greatest improvement in fortunes, led by the stabilising price of oil, with 73% of analysts responding that leading indicators are positive, up from just 8% two months ago. Nearly 60% of the firm’s analysts see positive leading indicators in healthcare, while just under a half see an improvement in the IT and material sectors, as well as consumer discretionary. Across the board, there was significant improvement in sentiment across sectors when compared with April this year.  When business activity does stabilise, and the Covid-19 crisis passes, it will do so at levels below those seen in 2019, according to the study. The global average of Fidelity analyst responses shows that activity will be 2.9% lower than pre-Covid levels, while activity in China is expected to be 2% lower, and Europe will be 4.4% lower. O’Neill added: “The road to recovery will not be smooth, with sectors and regions recovering at different speeds. However by the end of 2021, all sectors are expected to be at or above pre-Covid levels, with IT and healthcare sectors more than 10% higher, double the global average of around 5%.” © 2020 funds global asia

Sponsored Profiles

Sponsored feature: Asset allocators – How do you track your decisions?

Apr 06, 2020

Mark Barry, Head of Asset Allocation at Milestone Group, explores how a simple question can highlight opportunities to automate and streamline your asset allocation investment process.

Sponsored feature: How is DLT changing the global securities services landscape?

Oct 17, 2019

By Jeslyn Tan, global head of product management, securities services, at Deutsche Bank

Sponsored feature: A new base for fund distribution

Oct 16, 2019

To get the most value out of the digitisation of investment fund distribution, a blockchain-based infrastructure is fundamental. By Olivier Portenseigne, Managing Director and Chief Commercial Officer, Fundsquare.

Sponsored profile: Bridging the gap

Mar 11, 2019

Private equity is a core part of the business for Caceis’ Hong Kong office, which looks after clients in China and Europe. David Li, chief executive officer, explains why private equity enjoys strong client demand and how it is being used to fund China’s international infrastructure ambitions.

Executive Interviews

Executive interview: Understanding geographies

Apr 06, 2020

Margaret Harwood-Jones, co-head financing and securities services at Standard Chartered, shares her insights on platform standardisation, opportunities in Asia and regulatory change to encourage...

Executive interview: ‘Bull markets don’t die of old age’

Dec 12, 2019

Having a balanced portfolio in the midst of the longest expansion in history is an investment imperative, Chris Alderson, co-head of global equity and head of international equity at T Rowe Price...


Hong Kong roundtable: A ‘fragile Goldilocks situation’

Apr 06, 2020

With the global economy at a crossroads, our panel of experts share their thoughts on the market conditions, geopolitical volatility and growth opportunities. Chaired by Romil Patel in Hong Kong.

Singapore roundtable: A horizon to hold long-term assets

Dec 12, 2019

Panellists discuss the geopolitical fractures concerning asset owners, Singapore as a hub for fintech start-ups and why it makes sense to raise capital from a Variable Capital Company (VCC). Chaired by Romil Patel in Singapore.