Articles List

Diversified Miners: Capital & Supply Discipline To Persist Despite Better Performance

Major diversified miners will see improving financials and performance over the coming years as FY2016 marked the start of positive net incomes following years of losses. Nevertheless, miners will remain focused on capital and supply discipline, with debt reduction and efficiency enhancements despite improving commodity prices.

End of NAFTA: Short-Term Risks For Pharmaceutical Market

The renegotiation of NAFTA poses downside risks for the Mexican pharmaceutical sector and the multinational drugmakers that do business in the country. The market is threatened by the potential for prolonged weakness in the Mexican peso, protectionist trade measures and restricted foreign direct investment (FDI). Despite these risks, there remains a positive long-term view on the fundamentals of the Mexican pharmaceutical industry given the growing burden of chronic disease and increasing regulatory transparency.

Line's AI Push To Improve User Experience

Clova will be central to Line's long-term strategy of moving towards a 'cloud artificial intelligence' (AI) platform. In the medium term, it will enable Line to refine the quality of its services and support its revenues. Leveraging Line's strong grip on the region's largest consumer markets will be a differentiator in the face of global competitors, but huge investment will be needed in order ensure its AI technology is competitive.

Current Account Deficit Still Sustainable

We project Romania's current account deficit to continue widening over the next two years, driven by larger shortfalls in the primary income and trade balance. The country will easily attract the necessary funding over the coming years, primarily in the form of stable foreign direct investment.

Assessing The Potential For 'Win-Win' Trump Trade Deals

Protectionist policy threatens to damage the US economy, with little promise of bringing back jobs or investment to the US. However, were the Trump administration to shift its focus away from merely reducing the size of the trade deficit, we see scope for 'deals' that would do more to grow exports and foster domestic job creation while avoiding a major trade war and the economic damage it would entail.

Three-Speed Emerging Markets

Our forecasts for economic growth over the coming five years point to a phenomenon of 'three-speed emerging markets' - in other words, there will be three distinct groupings in terms of real GDP growth rates among the top 20 key emerging markets (EMs). 'Asian reformers' will outperform, 'commodity-exporting reform laggards' will underperform and the rest will experience middling growth.

ANO In Pole Position For Parliamentary Elections

The anti-establishment Action for Dissatisfied Citizens (ANO) is well placed to become the largest party after October 2017 parliamentary elections. Although ANO is already in government as the junior coalition partner, its rising influence will likely portend reduced state involvement in the economy, pro-business policies, fiscal reforms, and greater resistance to the Czech Republic's deeper integration with the EU.

Brent: Upside Break Faces H2 Resistance

We maintain our USD57.0/bbl Brent forecast in 2017, with a bullish short-term outlook driven by strong OPEC compliance and stock draws in H1, though softened by higher US and OPEC production in H2.

Falling Infrastructure Share Signals Construction Strength In Emerging Economies

Private-led projects will become more common in the fast-growing construction industries of Indonesia, the Philippines and Vietnam as the share of the construction market the infrastructure sector holds declines over the next 10 years. Meanwhile, government-led projects will come into focus in China, Singapore and Thailand as policymakers seek to use infrastructure investments to boost slowing growth.

Weak Naira A Headwind For Toyota, JAC Vehicle Assembly

A large devaluation of the naira and foreign exchange shortage will make 2017 a challenging year for domestic vehicle manufacturers in Nigeria, providing headwinds for Toyota's and JAC Motors' newly announced assembly plans.

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