The global economy as a whole is in a very delicate situation. Since September 2018, when we had synchronized global growth, things have changed dramatically and the global economy has begun to decline. All of this came as a surprise from the deepening trade dispute between China and the USA. It was as if the world's leading central banks had not taken the threats as seriously as the actually should have. However, the market has received strong support from the leading central banks and aims to mitigate the risk of trade wars. This was commented by Ivaylo Angarski, Executive Director of Compass Invest JSC, in the show "In Development" hosted by Delyan Petrishki.
“In regards of the new reporting season, there is a discrepancy between forecasts and real results. The market consensus was for a decline of 4.3% in corporate profits for the quarter and today the latest data from Reuters show a decline of 2.2% in profits of companies”.
Last week, the International Monetary Fund (IMF) forecast was for 3.3% growth for the global economy this year and 3.6% for next year, taking into account these global risks, Angarski said.
"Investors must always be prepared for the worst, but also hope for the best. Professional investors must monitor market movements on a daily basis. Even Trump realizes that a positive development in world trade is good for everyone, but under profitable for everyone rules”.
On Friday, JP Morgan reported much higher results than expected, for example, said the guest. In Europe, we saw good, double-digit results from Louis Vuitton, he added.
“We have included many of the technology giants of America and China in our portfolios. But we are not looking for instant rocket carriers, but companies that can offer sustainable revenue and profit growth for the next 10 years above market averages”.
There are already institutional investors who want to enter the “stars of the future” at an early stage, said Ivaylo Angarski. “At the same time, these companies are spoiled due to the great interest in them. They are becoming so big that they are being pressured by investors to list on the stock exchange” he explained.
Video material with the whole interview you can see here.