- 多元資產策略師
香港, 個人投資者
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本刊所載見解反映作者於撰文時的觀點，其他團隊可能觀點各異，或會作出不同的投資決策。閣下投資的價值可能高於或低於初始投資時的水平。本刊所載第三方數據被視為可靠，惟概不保證其準確性。
僅提供英文版本
As of 14 March 2023
The -9.8% US regional banking sector sell-off at time of writing is one of the largest one-day negative returns in the history of the KWB Nasdaq Bank index. The sell-off that started last Friday comes at a time when consensus expectations had begun to favour the probability of the US Federal Reserve (Fed) engineering a soft landing, based on leading indicators of economic activity, consumer sentiment, rebounding manufacturing new orders and potential signs that the US housing market was starting to bottom out.
But it appears that the markets now see banking stress impacting the Fed's inflation-fighting strategy, as evidenced by significant downward moves in interest rates, which have dropped in recent days (by 41 basis points for 10-year paper and 99 basis points for two-year paper, respectively, from the end of day on March 8 to the time of writing). This suggests that markets expect the Fed to be increasingly concerned about financial instability, perhaps even more so than the inflation worries that have been at the centre of the central bank's attention for the past year-plus.
It's worth noting that the global backdrop has been more resilient to the regime shift towards higher interest rates and higher inflation than we had expected, and equity markets have largely taken these moves in their stride. However, we also recognise that inflation is uncomfortably high for central banks. In this environment of sticky inflation, where central bank terminal rates are being repriced, we believe that corporate earnings and multiples, as well as credit spreads, remain vulnerable.
The impact of policy tightening is making its way through the system, although the long tail of historical liquidity has meant that both the timing and magnitude of the impact is less predictable than it's been in the past. This suggests more room for policy error and liquidity-induced accidents like the Silicon Valley Bank Financial Group (SVB) crisis. The history of financial markets suggests that policy tightening regimes often have unanticipated knock-on effects, like the collapse of two Bear Stearns hedge funds in 2007.
Key areas impacted by tightening financial conditions include:
- The banking system, where a large net percentage of institutions are tightening standards on commercial and industrial loans, according to a recent Senior Loan Officer Survey cited by the Federal Reserve Bank of St. Louis (FRED).
- Capital markets, which have been more sanguine ahead of this episode and where large borrowers have termed out fixed-rate borrowing.
Regarding the banking system, the Fed's rate hikes have prompted an inversion of the yield curve, which reduces net interest margins and profitability, and, over time, leads banks to tighten lending. In addition, the Fed has let its balance sheet passively run off to the tune of roughly US$95 billion per month while also draining its liabilities, including bank reserves, amid its cycle of quantitative tightening. Taken together, this can have a nonlinear impact on banks' liquidity past a certain point through funding markets.
Right now, it's still unknown if SVB's fate will pose serious contagion risk or have systemic impacts. The Federal Deposit Insurance Corporation (FDIC) and state regulator have stepped in to protect depositors while the Fed has announced a new lending facility, but further regulatory ramifications are unclear. From a macro perspective, this event emphasises that the typical transmission mechanism from central bank tightening through the financial system (and, eventually, the real economy) is likely still intact and is likely to accelerate. We will be closely watching market volatility and policy reactions in the US and other markets for further cues.
While the US is at the epicentre of the stress, developed markets outside the US are affected due to their higher-beta nature and because any US liquidity tightening will impact global growth. However, there are clearly different dynamics in play from region to region and we expect these to be taken on board by investors over time. For example, China seems largely insulated from recent US events as its economy benefits from reopening, with other Asian regions benefiting as well. While the market has also pared back rate expectations in the eurozone, the European Central Bank will face a tough balancing act between the need to support financial stability and the continued uphill struggle against core inflation pressures.
What does this mean for investors?
At this early stage, it is difficult to map potential outcomes. We think investors should closely monitor developments and the potential risks for portfolios. Ultimately, decisive US policy action and the market slide — which is helping to address the problem by bringing down yields and therefore the extent of unrealised losses — may lead to stabilisation and opportunity, but it is too early to tell. For now, we would advocate a more defensive portfolio positioning.
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在未有威靈頓投資管理明確書面批准的情況下，概不可複製或轉載本刊全部或任何部分內容。本文件僅供參考之用，並非任何人士要約或邀請認購威靈頓投資管理（盧森堡）SICAV基金III系列的股份。本文件所載資料不應被視為投資建議，亦非買賣任何股份之推介。基金投資不一定適合所有投資者。所載見解反映作者於撰文時的觀點，可予更改而不作另行通知。投資者於作出投資決定前，務請細閱基金及子基金的產品資料概要、基金招股章程及香港說明文件，以了解詳情（包括風險因素），其他有關文件包括年度及半年度財務報告。
由威靈頓管理香港有限公司刊發。投資涉及風險。過去業績並不代表將來表現。本文件未經香港證券及期貨事務監察委員會審閱。
