It was a mixed bag of performance during the quarter where Russia made gains, Indian equities gave back some of the strong gains from last year and China saw a moderate increase.

India’s GDP growth forecasted at 7.4% for fiscal 2019 with the latest reading on consumer inflation of 4.4%, neutral stance on rate changes from the central bank, a normal monsoon set the stage for a benign second half of the year.

The Chinese economy reported a 6.8% GDP number for the quarter fuelled by strong domestic consumption, which accounted for 80% of the growth.  GDP for 2018 is 6.5%, inflation of 3% and new job creation of 11 mn.  Lower personal income taxes bodes well for enabling continued strong mass consumption.  Note the milestone event took place on the political front during the quarter where President Xi Jinping can stay indefinitely as President since term limits were removed.

Russia benefited from a good start this year supported by high and stable oil prices. However the market growth continued only for two months and after that, in March, the market experienced approximately 5% correction from its high as a result of deterioration of foreign relations between Russia and West.  In short term, this correction can become deeper due to further growth of geopolitical tensions and expectation of new sanctions implementation against Russia. Russia remains a net saver and has amassed reserves of almost US $ 460 bn.

Domicile: Malta, Source: Bloomberg

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