National Bank of Greece | Economic Research Division ... · bps to 0.09% (the lowest level since late 2016). We have turned short duration tactically, albeit we acknowledge that incoming

See page 14 for disclosures and analyst certification

1

-24

-18

-12

-6

0

6

-24

-18

-12

-6

0

6

Sep

-17

Oct

-17

No

v-1

7

De

c-1

7

Jan

-18

Feb

-18

Mar

-18

Ap

r-1

8

May

-18

Jun

-18

Jul-

18

Au

g-1

8

Sep

-18

Oct

-18

No

v-1

8

De

c-1

8

Jan

-19

Feb

-19

EA Banks vs EuroStoxx

Euro Area Banks vs EuroStoxx

Source: NBG Research, Bloomberg

January 1st 2018=0

% %

Banks Overperform 2019

-30

-25

-20

-15

-10

-5

0

5

10

15

20

25

30

-30

-25

-20

-15

-10

-5

0

5

10

15

20

25

30

Sep

-17

Oct

-17

No

v-1

7

De

c-1

7

Jan

-18

Feb

-18

Mar

-18

Ap

r-1

8

May

-18

Jun

-18

Jul-

18

Au

g-1

8

Sep

-18

Oct

-18

No

v-1

8

De

c-1

8

Jan

-19

Feb

-19

Weekly EPS Revisions 4-week Average

MSCI ACWI 12-month Forward EPS Revisions

Source: NBG Research, Datastream, I/B/E/S, MSCI ACWI = All Country World Index

% %

EPS Revisions = (#Cos with Positive EPS Rev. - #Cos with Negative) / Total

,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,

N A T I O N A L B A N Κ

O F G R E E C E

Ch

art

s o

f th

e w

ee

k

Global Markets Roundup

National Bank of Greece | Economic Research Division | February 12, 2019

New catalysts are needed for the equity market rally to be sustained, as GDP growth worries

persist

Ilias TsirigotakisAC

Head of Global

Markets Research

210-3341517

[email protected]

Panagiotis Bakalis

210-3341545

[email protected]

Lazaros Ioannidis

210-3341207

[email protected]

Vasiliki Karagianni

210-3341548

[email protected]

Table of Contents

Overview_p1

Economics & Markets_p2,3 Asset Allocation_p4

Outlook_p5,6

Forecasts_p7 Event Calendar_p8

Markets Monitor_p9

ChartRoom_p10,11

Market Valuation_p12,13

Markets paused for breath in the past week, following five consecutive weekly gains totaling 8.5%,

as global growth concerns prevailed and negative headlines regarding US-China trade tensions hurt

sentiment. Nevertheless, high-level talks are expected to take place in Beijing this week between US-

Sino officials, with the possibility of an extension to the March 1st deadline (when US tariffs on

$200bn worth of Chinese imports are scheduled to increase to 25% from 10%).

The MSCI ACWI ($) declined by 0.6% wow (+7.3% ytd), with emerging markets underperforming

developed market peers by 90 bps wow – they have moved in tandem ytd. A dovish Fed and the

accelerating pace of Chinese fiscal and monetary stimulus is expected to support EM equities, with

valuations appearing more favorable than historical averages.

Indeed, the MSCI EM P/BV of 1.4x trades at a 32% discount vs MSCI DM P/BV (17% discount on

average), while the MSCI EM 12-month forward P/E of 11.5x trades at a 21.1% discount vs MSCI DM

P/E (21.4% discount on average).

Regionally, the DAX30 ended the week deep in the red (-2.4%) and has lagged other European

bourses by a wide margin year-to-date (150-250 bps) as a large percentage of its constituents’

revenue stems from abroad, particularly China. Moreover, note that the Department of Commerce

Section 232 investigations on automobile and automotive parts is due by February 17th, and could

recommend the imposition of tariffs, which would put further strain on the German auto industry.

Regarding company earnings, with circa ⅔ of S&P500 companies having reported results, so far,

results are mixed. 71% of companies have exceeded analyst estimates, broadly in line with historical

averages. EPS growth hovers at 13% yoy compared with 26% yoy on average in 9M:2018. Moreover,

out of the 65 S&P500 companies that have issued EPS guidance for Q1:19, 82% have issued

negative guidance, which is significantly above the 5-year average of 71%. As a result, 2019 EPS

growth is expected at +5% yoy, versus +20% yoy in 2018.

On the other side of the Atlantic, corporate results are average, with Eurostoxx financials (SX7E)

reporting growth of -8% yoy in Q4:2018, so far, as flat euribor curves hurt net interest margins and

heightened volatility in Q4 squeezed capital market revenues. Moreover, the severe slowing of euro

area economic activity has caused the SX7E to underperform by 320 bps ytd (-1850 bps in 2018 --

see graph below).

As the loss of momentum in the euro area continues, investors sought the safety of German Bunds,

with yields declining by 8 bps to 0.09% (the lowest level since late 2016). We have turned short

duration tactically, albeit we acknowledge that incoming data must stabilize before rates increase. In

that respect, we will monitor the Q4 German GDP on February 14th and PMIs indicators on February

21st. UK Gilts also declined by 10 bps to 1.15% as the Bank of England joined the chorus of dovish

central banks (see Economics & Markets).

mailto:[email protected]


O F G R E E C E

NBG Global Markets Roundup | Economics & Markets Section

National Bank of Greece | Economic Research Division | Global Markets Analysis

2

US bank lending standards tightened slightly in Q4:2018

The Fed’s Senior Loan Officer Opinion Survey (SLOOS) for

Q4:18 suggests a modest tightening in banks’ credit standards

for loans to corporates and broadly stable standards for loans

to households. Regarding corporates, lending standards for

commercial and industrial (C&I) loans tightened (3% of banks for

large and middle corporates), following seven consecutive quarters

of easing (a net percentage of 10% of banks, on average, eased

standards since Q2:17 | 16% of banks in both Q3:18 and Q2:18).

According to the respondents, the easing effect on loan standards

from increased competition was counteracted by the less favorable

economic outlook and reduced banks’ tolerance for risk. Standards

for commercial real estate (CRE) loans tightened across sub-

categories (construction and land development, non-farm non-

residential, multi-family), after having remained broadly stable in

the previous three quarters. Regarding households, credit

standards for mortgage loans were broadly stable in Q4:18 (after

being in easing territory since Q2:14), while they tightened across

consumer loan categories (credit cards, auto loans and other

consumer loans).

On the demand side, credit appetite weakened for all loan

categories. Regarding C&I loans, lower financing needs for

mergers and acquisitions, as well as an increase in firms’ internally

generated funds, contained loan demand. The latter may be

related to the large repatriation during 2018 of corporates’ foreign

profits held abroad ($960 bn in from Q1:18 to Q3:18, cumulatively),

as well as the strong corporate earnings in that period. On a

negative note, however, a decline in investment in plants and

equipment was also cited as an important factor for weaker loan

demand. Finally, in the latest survey, banks reported that, in 2019,

they expect credit standards to tighten and demand to weaken

across loan categories.

The European Commission downgraded substantially its

estimate for 2019 euro area GDP

The EC reduced sharply its forecast for euro area GDP growth

in 2019, due to a more-pronounced-than-previously-

anticipated slowdown of economic activity in H2:18, as well as

due to signs that the softness continues in the beginning of

2019. The EC downgraded its forecast for euro area real GDP

growth in 2019 by 0.6 pps, compared with its previous projections

in November 2018, to 1.3% yoy (the projection for 2020 was

reduced slightly, by 0.1 pp to 1.6% yoy). Apart from negative

effects from the weakening of global trade, the EC cited the

longer-than-initially-expected persistence of some negative

domestic (and largely country-specific) factors. These factors

include, inter alia, i) disruptions in the car industry due to the

adjustment of producers to the new emission testing regime

(Worldwide Light Vehicle Test Procedure), with Germany (30% of

euro area GDP) significantly impacted (2019 GDP growth

projection: -0.7 pps to 1.1% yoy); ii) social tensions in France (20%

of euro area GDP | 2019 GDP growth projection: -0.3 pps to 1.3%

yoy); and iii) fiscal and broader economic policy uncertainty in Italy

(15% of euro area GDP | 2019 GDP growth projection: -1.0 pp to

0.2% yoy). Regarding the latter, it should be noted that the 2019

Budget assumes real GDP growth of 1.0% yoy in 2019. Thus,

should the EC forecast for just 0.2% yoy be materialized, the

budget deficit target of 2.04% of GDP would be challenged, if the

planned increase in government spending is to be executed in full

(with a lower than assumed GDP, the planned increased

government spending would result in a higher budget deficit as %

of GDP). Finally, the EC views mainly downside risks to the outlook

for euro area GDP (e.g. a potential further escalation of trade

tensions, a sharper-than-expected slowdown in China, risks of an

abrupt fiscal tightening in the US in 2020). Note also that the EC’s

forecasts are predicated on the (purely technical) assumption of

maintaining the status quo in the terms of trading between the EU

and the UK, thus a no-deal Brexit poses further downside risks.

The Bank of England cuts its UK growth projections

The BoE maintained its policy rate unchanged at 0.75% and

the QE target at ₤435bn, as expected, but revised down its

GDP and inflation forecasts on the back of continued

uncertainty regarding Brexit. Growth is expected to remain soft

in 2019, reflecting weaker economic activity abroad as well as

persisting uncertainty regarding the Brexit process. Uncertainty

about the terms of the eventual trading relationship between the

EU and the UK affects spending decisions, most notably of

businesses (e.g. postponing investment projects).

Overall, the BoE’s 2019 GDP growth projection was cut to +1.2%

yoy, 0.5 pps lower compared with the November Inflation Report

(IR), while the 2020 growth forecast was brought down by 0.2 pps

to +1.5% yoy. Assuming a smooth Brexit process, the BoE expects

growth to pick up in 2021 (+1.7%) due to recovering business

investment, as uncertainty wanes. Lower energy prices should drive

down inflation in the near term (2019: +1.9% yoy vs +2.2% in

November and +2.5% in 2018), but a tight labor market is

expected to exert some inflationary pressures in the medium term.

Indeed, strong wage growth, in conjunction with weaker

productivity growth, results in higher unit labor costs that are

passed though into inflation (2020: +2.2%, 2021: +2.1%).

Those forecasts are based on circa two interest rate hikes over the

next three years (officials expected to raise interest rates three

times in their last projections in November ‘18) in order for

inflation to remain close to 2%. Market pricing remains more

benign, with investors discounting just one hike by end-2021 to

around 1.0%.


O F G R E E C E

NBG Global Markets Roundup | Economics & Markets Section


3

Quote of the week: “We have a pretty good sense of the

direction in a no deal, no transition Brexit. There would be a

hit to supply capacity, we would expect demand to go

down, and we would expect sterling to depreciate,

consistent with the change in our terms of trade”, Bank of

England Governor, Mark Carney, February 07th 2019.

Equities

Global equity markets need new catalysts that will determine their

direction going forward, as investors digest the dovish stance by central

banks. The MSCI World declined by 0.6% wow (+7.3% ytd), with German

equities under-performing (DAX30: -2.4% wow) on the back of data suggesting

softening activity (industrial production and orders) around the turn of the year

that could have left GDP growth in mildly negative territory in Q4:18. The

S&P500 was flat on a weekly basis (+8% ytd), as weakness abroad

counterbalanced positive EPS releases. Overall, with 66% of the S&P500 having

reported results, so far, circa 71% has exceeded analyst estimates. Consensus

expects double-digit EPS growth of +13.3% yoy, compared with estimates for

+11% yoy in early January. Notwithstanding the good performance in Q4:18, out

of the companies (65) that have issued guidance for the current quarter (Q1:19),

82% have issued negative guidance. EPS growth expectations for 2019 (+5.1%

yoy, versus +20% yoy in 2018) have continued to decelerate (estimates for

+7.6% yoy in early January).

Fixed Income Government bond yields continued to decline across the board, reflecting

weak data and dovish central banks. The UST 10-year yield decreased by 5

bps wow to 2.63%, while the UK’s 10-year Gilt yield fell by 10 bps wow to 1.15%,

as the Bank of England lowered its growth and interest rate estimates. Similarly,

the German 10-year Bund yield was down by 8 bps wow to 0.09% (lowest since

October 2016). Periphery bond spreads over the Bund rose on the back of

increased risk aversion (in the range of 6 – 29 bps), with Italy’s BTP spread up by

29 bps wow to 287 bps as the European Commission cut sharply its Italian

growth forecasts.

Corporate bonds spreads were mixed in the past the week. US HY corporate

bonds spreads rose moderately by 3 bps to 432 bps, while EUR HY spreads were

unchanged (at 449 bps). In contrast, investment grade spreads declined (EUR IG:

-4 bps to 139 bps, US IG: -2 bps to 134 bps), despite lower government bond

yields and weak data, as investors likely searched for yields.

FX and Commodities In foreign exchange markets, the British Pound lost ground (-0.35% in

NEER terms and -1.1% against the USD to $1.294) on the back of the BoE ‘s

dovish stance, below expectations economic data and Brexit anxiety (see

Graphs 1-3). We highlight 3 possible scenarios that try to outline what could

happen under each state of events: i) a Brexit deal by March 29th; (ii) an

agreement to extend Article 50 beyond March; and (iii) a hard Brexit. The first

scenario should support the British Pound modestly as uncertainty regarding

future trade arrangements diminishes significantly. Under the second scenario,

Brexit is extended beyond March 2019 as UK MPs try to prevent a hard exit from

the EU. The British Pound could tread water if this was to happen, as a potential

short-term relief rally could be followed by a further prolonged period of

uncertainty (plus the risk of new elections). Finally, the third scenario is that of a

no-deal hard Brexit, whereas the the British Pound could weaken materially.

In commodities, oil prices declined strongly in the past week, with the WTI

down by 4.6% wow to $52.7/barrel and Brent down by 1.1% to $61.9/barrel.

-3

-2

-1

0

1

2

3

4

5

6

7

-3

-2

-1

0

1

2

3

4

5

6

7

Jan

-15

Ap

r-1

5

Jul-

15

Oct

-15

Jan

-16

Ap

r-1

6

Jul-

16

Oct

-16

Jan

-17

Ap

r-1

7

Jul-

17

Oct

-17

Jan

-18

Ap

r-1

8

Jul-

18

Oct

-18

Jan

-19

Ap

r-1

9

GBP/USD GBP/EUR

Source: NBG Research, Bloomberg, a positive volatility spread suggests the volatility (price) for calls is higher than that of puts indicating expectations of appreciation for the base currency (USD, EUR) relative to the GBP

%%

Higher values suggest investors are more willing to bet that the GBP will lose value relative to its peers over the next 3 months

GBP 3m Risk Reversals: Call minus Put Option Volatility

Graph 3.

Graph 2.

0,0

0,2

0,4

0,6

0,8

1,0

1,2

1,4

1,6

1,8

2,0

0,0

0,2

0,4

0,6

0,8

1,0

1,2

1,4

1,6

1,8

2,0

2018 2019 2020 2021

November '18 February '19


Bank of England GDP Growth Forecasts

% %

Graph 1.

10

20

30

40

50

60

70

80

10

20

30

40

50

60

70

80

1-A

ug

15

-Au

g

29

-Au

g

12

-Se

p

26

-Se

p

10

-Oct

24

-Oct

7-N

ov

21

-No

v

5-D

ec

19

-Dec

2-J

an

16

-Jan

30

-Jan

13

-Fe

b

Probability of No-deal Brexit before April 01, 2019

Probability of 2nd Referendum%%


Average implied Probability from Betting Odds

NBG Global Markets Roundup | Asset Allocation


4


O F G R E E C E

GovernmentBonds

CorporateBonds

Equities

Cash

Commodities OW

UW

OW

UW

Assets MW

Equities

US

Euro Area

Japan

UK

Emerging Markets

Government Bonds

US Treasury Bonds

US TIPs

German Bund

Sterling Gilt

Japan GBs

Corporate Bonds

USD Corp IG

USD Corp HY

EUR Corp IG

EUR Corp HY

Commodities

Crude Oil

Gold

Cash

UnderWeight OverWeight

Max OverWeight

Max UnderWeight

Market Weight

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

0% 1% 2% 3% 5% 6% 7% 8% 9% 10% 11% 13% 14% 15%

US_EQ

EA_EQ

JP_EQ

UK_EQ

EM_EQ

USTs

USTIPs

GBUNDS

UKGILTS

JGBS

USDIG

USDHY

EURIG

EURHY

OIL

GOLD

CASH

Stand. Deviation (Ann.)

Optimal Risky Portfolio (Highest Sharpe Ratio, No Cash Allocation)

Benchmark

(1) Figure1: Green (red) color arrows suggest an increase (decrease) in relative asset class weights over the last week (Tactical Asset Allocation tilits

vs our Strategic Asset Allocation portfolio).

(2) Figure2: The orange/light blue circles of the chart displays current asset class and intra-asset class tilts relative to the Strategic Asset Allocation

portfolio. Black arrows point to an increase/decrease, if any, relative to previous allocations.

(3) UW|MW|OW: Underweight | Marketweight | Overweight Tactical Asset Allocation (TAA) relative to our Strategic Asset Allocation portfolio.

Figure2. NBG Global Portfolio TAA Tilts: LEVEL 2

NBG Global Portfolio Tactical Asset Allocation (TAA)

Equities: Economic growth is slowing with risks on the downside

(trade). Moreover, expectations for 2019 company earnings are high

(MSCI DM 2019 EPS growth of 6%), risking disappointment. The

equity market will struggle to go higher near-term, following

December’s sell-off, albeit with the Fed effectively on a “wait-and-see”

mode, risk premia could decline further fueling more relief near-term.

Valuations have normalized, albeit not outright cheap with the MSCI

DM P/E ratio at 14.6x vs a 30-y average of 16.1x. All in, as we are near

end-cycle, volatility in returns will continue. As a result, we remain

broadly neutral tactically relative to a Strategic Asset Allocation

(SAA) benchmark of 60-30-10, which is categorized as a moderate

to moderate aggressive portfolio. Intra-class, positioning (since late

November) continues in favor of Emerging Markets reflecting the

stabilization of the USD, trade détente (at least until early March) and

measures by the Chinese Government to support the economy.

Government Bonds: For the first time in many years, higher yields

(lower prices) do not form our baseline scenario with many degrees of

certainty. The Fed is expected to pause at least until June and UST

yields may have peaked for this cycle at 3.25% as long as inflation

pressures are modest. German Bunds and UK Gilts yields, however,

have upside potential assuming euro area growth stabilizes (ECB QE

exit will weigh in the course of 2019) and Brexit negotiations conclude

with some form of deal. Steeper curves there. Overall, small

underweight in Govies. Intra-class, we hold relative positions that

can alleviate portfolio losses (e.g. OW USTs due to higher coupons)

assuming that prices continue to increase.

Credit: We are broadly underweight in Corporate Bonds retaining a

neutral view intra-class (Investment Grade vs Speculative Grade) and

cross-currency (EUR vs USD paper). Quantitative Tightening (ECB),

deteriorating Debt-Service-Ratios and Quality (BBB issues are 50% of

IG indices vs 20% pre-QE) and higher recession risks weigh on spreads

and returns. Cash: Overweight position, as a hedge, as well as a way

of being tactical.

Figure1. NBG Global Portfolio TAA Tilts: LEVEL 1

Figure3. Efficient Portfolio Allocation for Various

Volatility Levels

NBG Global Markets Roundup | NBG 12-Month View & Key Factors for Global Markets


5


O F G R E E C E

Eq

uit

y M

ark

ets

G

overn

men

t B

on

ds

Fo

reig

n E

xch

an

ge

US Euro Area Japan UK

Reduced short-term tail

risks

Higher core bond yields

Current account surplus

▬ Sluggish growth

▬ Deflation concerns

▬ The ECB’s monetary

policy to remain extra

loose (Targeted-LTROs,

ABSs, covered bank

bond purchases,

Quantitative Easing)

Tax cuts may boost growth,

and interest rates through a

more aggressive Fed

Safe-haven demand

▬ Fed on a “Wait-and-see”

mode at least in H1:2019

▬ Protectionism and trade

Wars

▬ Mid-2018 rally probably out

of steam

Safe haven demand

More balanced economic

growth recovery (long-

term)

Inflation is bottoming out

▬ Additional Quantitative

Easing by the Bank of

Japan if inflation does not

approach 2%

Transitions phase

negotiations

The BoE is expected to

increase short-term policy

rates assuming WA deal

▬ Sizeable Current account

deficit

▬ Elevated Policy

uncertainty to remain due

to the outcome of the

Referendum and the

negotiating process

Valuations appear

excessive compared

with long-term

fundamentals

ECB exits, albeit slowly,

net QE (flow effect)

▬ Political Risks

▬ Fragile growth outlook

▬ Medium-term inflation

expectations remain

low

▬ ECB QE “stock” effect

Valuations appear rich with

term-premium close to 0%

Underlying inflation

pressures

Balance sheet reduction,

albeit well telegraphed may

push term premia higher

▬ Global search for yield by

non-US investors continues

▬ Safe haven demand

▬ Fed on a “Wait-and-see”

mode at least in H1:2019

Elevated Policy



Brexit negotiating process

Inflation overshooting due

to GBP weakness feeds

through inflation

expectations

The BoE is expected to

increase short-term policy

rates assuming WA deal

▬ Slowing economic growth

post-Brexit

Sizeable fiscal deficits

Restructuring efforts to

be financed by fiscal

policy measures

▬ Safe haven demand

▬ Extremely dovish

central bank

▬ Yield-targeting of 10-

Year JGB at around 0%

Still high equity risk

premium relative to other

regions

Credit conditions gradual

turn more favorable

Small fiscal loosening in

2019

▬ 2019 EPS estimates may

turn pessimistic due to

plateuning economic

growth

▬ Political uncertainty (Italy,

Brexit) could intensify

Fiscal loosening will support

the economy & companies’

earnings

Solid EPS growth in 2018 &

strong in 2019

Cash-rich corporates will

lead to share buybacks and

higher dividends (de-

equitization)

▬ Peaking profit margins

▬ Protectionism and trade

wars

Still aggressive QE and “yield-

curve” targeting by the BoJ

Upward revisions in corporate

earnings

▬ Signs of policy fatigue

regarding structural reforms

and fiscal discipline

▬ Strong appetite for foreign

assets

▬ JPY appreciation in a risk-off

scenario could hurt exporters

65% of FTSE100 revenues

from abroad

Undemanding valuations

in relative terms

High UK exposure to the

commodities sector

assuming the oil rally re-

emerges

▬ Elevated Policy



Brexit negotiating process

Neutral Neutral/Positive Neutral

Slightly higher yields

expected

Higher yields expected

Stable yields expected

Higher yields expected but

with Brexit risk premia

working on both directions

Broadly Flat EUR

against the USD with

upside risks towards

$1.18

Neutral/Negative

Higher GBP expected but

with Brexit risk premia

working on both directions

Broadly Flat USD

against the EUR with

upside risks towards

$1.18

Slightly higher JPY

NBG Global Markets Roundup | NBG 12-Month View & Key Factors for South Eastern European Markets


6


O F G R E E C E

Turkey Romania Bulgaria Serbia

Emerging Markets Research, Head: Dr. Michael Loufir, tel:210-3341211, email: [email protected]

Fo

reig

n D

eb

t

Attractive valuations

▬ Weak foreign investor

appetite for emerging

market assets

▬ Persisting domestic

financial crisis

Strong economic activity




market assets


Low-yielding domestic

debt and deposits



market assets




market assets

Eq

uit

y M

ark

ets

D

om

est

ic D

eb

t Fo

reig

n D

eb

t Fo

reig

n E

xch

an

ge

Turkey Romania Bulgaria Serbia

Low public debt-to-GDP

ratio

▬ Loosening fiscal stance

▬ Stubbornly high inflation


financial crisis

Low public debt-to-GDP

ratio

▬ Easing fiscal stance

▬ Envisaged tightening in

monetary policy

Very low public debt-to-

GDP ratio and large fiscal

reserves

Positive inflation outlook

Policy Coordination

Instrument with the IMF

Restored fiscal and public

debt sustainability

Acceleration in economic

activity

▬ Large public sector

borrowing requirements

High foreign debt yields

▬ Sizeable external

financing requirements



market assets


financial crisis

▬ Large external financing

requirements

▬ Heightened domestic

political uncertainty

Solidly-based currency

board arrangement, with

substantial buffers



requirements

Ongoing EU membership

negotiations

Policy Coordination


▬ Sizable external financing

requirements

▬ Reinvigorated progress in

structural reforms

Currency board

arrangement

Large foreign currency

reserves and fiscal

reserves



requirements



High domestic debt yields


requirements



market assets

▬ Persisting geopolitical risks

and domestic financial crisis

▬ Escalating global trade war


requirements



Ongoing EU membership

negotiations

Policy Coordination


Large FDIs


requirements

Neutral/Positive Neutral/Positive Neutral/Positive Neutral/Positive

Stable to lower yields Stable to lower yields Stable to higher yields Stable to lower yields

Stable to narrowing

spreads

Stable to narrowing

spreads

Stable to narrowing

spreads

Weaker to stable TRY

against the EUR

Stable BGN against the

EUR

Stable to widening

spreads

Weaker to stable RON

against the EUR

Stable to stronger RSD

against the EUR

NBG Global Markets Roundup | Economic & Markets Forecasts


7


O F G R E E C E

Economic Indicators Stock Markets (in local currency)

2015 2016 2017 2018e 2019f 2020f

Real GDP Growth (%) Country - Index

Turkey 6,1 3,2 7,4 2,5 0,2 3,0 Turkey - ISE100 104.395 2,1 15,4 19,3

Romania 3,9 4,8 7,0 4,2 3,8 3,4 Romania - BET-BK 1.474 1,0 1,2 0,5

Bulgaria 3,5 3,9 3,8 3,3 3,6 3,2 Bulgaria - SOFIX 573 -0,9 -3,5 -5,1

Serbia 1,8 3,3 2,0 4,3 4,0 3,8 Serbia - BELEX15 709 1,3 -6,9 1,0

Headline Inflation (eop,%)

Turkey 8,8 8,5 11,9 20,3 14,5 11,5

Romania -0,9 -0,5 3,3 3,3 3,0 2,8 1-m Money Market Rate (%)

Bulgaria -0,4 0,1 2,8 2,7 2,9 2,7 Turkey 24,2 23,5 22,0 18,5

Serbia 1,5 1,6 3,0 2,0 1,8 2,0 Romania 3,3 3,0 3,0 3,0

Bulgaria(*) 0,0 0,0 0,0 0,1

Current Account Balance (% of GDP) Serbia 2,7 2,9 3,1 3,5

Turkey -3,7 -3,8 -5,6 -3,6 -2,8 -3,6 Currency

Romania -1,2 -2,1 -3,2 -4,0 -4,4 -4,7 TRY/EUR 5,95 6,30 6,60 6,80

Bulgaria 0,0 2,6 6,5 2,8 0,7 -0,6 RON/EUR 4,74 4,80 4,82 4,85

Serbia -3,5 -2,9 -5,3 -4,9 -4,6 -4,1 BGN/EUR 1,96 1,96 1,96 1,96

RSD/EUR 118,1 116,5 116,0 115,0

Fiscal Balance (% of GDP) Sovereign Eurobond Spread (bps)

Turkey -1,0 -1,1 -1,5 -1,9 -2,5 -2,5 Turkey (USD 2020)(**) 284 270 260 240

Romania -1,5 -2,4 -2,8 -2,9 -3,6 -3,8 Romania (EUR 2024) 147 130 120 110

Bulgaria -2,8 1,6 0,8 0,1 -0,5 -0,5 Bulgaria (EUR 2022) 56 52 45 40

Serbia -3,5 -1,2 1,1 0,6 0,4 -0,2 Serbia (USD 2021)(**) 136 120 116 110

f: NBG forecasts (*) Base interest rate (**) Spread over US Treasuries

Financial Markets

Last week

return (%)11/2/2019

Year-to-Date

change (%)

2-year

change (%)

11/2/20193-month

forecast

6-month

forecast

12-month

forecast

South Eastern Europe Economic Forecasts

2017a Q1:18a Q2:18a Q3:18a Q4:18f 2018f Q1:19f Q2:19f Q3:19f Q4:19f 2019f

2,2 2,6 2,9 3,0 3,0 2,9 3,0 2,5 2,1 2,0 2,4

- 2,2 4,2 3,4 2,5 - 2,1 2,1 1,8 1,7 -

Private Consumption 2,5 0,5 3,8 3,5 3,6 2,7 2,3 2,2 2,1 2,1 2,7

Government Consumption -0,1 1,5 2,5 2,6 2,2 1,6 3,6 3,3 1,9 1,3 2,7

Investment 4,8 8,0 6,4 1,1 3,5 5,3 2,6 3,1 2,9 2,8 3,0

Residential 3,3 -3,4 -1,4 -3,5 -3,6 -0,2 -2,3 -1,4 -0,9 -0,4 -2,2

Non-residential 5,3 11,5 8,7 2,5 4,7 6,9 3,7 4,0 3,7 3,5 4,1

Inventories Contribution 0,0 0,3 -1,4 2,7 -0,2 0,1 -0,1 0,0 0,0 0,0 0,2

Net Exports Contribution -0,4 -0,1 1,3 -2,3 -0,6 -0,3 -0,5 -0,5 -0,4 -0,4 -0,6

Exports 3,0 3,6 9,3 -4,9 3,7 4,1 2,8 2,6 2,4 2,3 2,3

Imports 4,6 3,0 -0,6 9,3 6,2 4,8 4,6 4,4 4,1 4,0 5,0

Inflation (3) 2,1 2,2 2,7 2,6 2,2 2,5 1,8 1,8 1,7 1,6 1,7

2017a Q1:18a Q2:18a Q3:18a Q4:18f 2018f Q1:19f Q2:19f Q3:19f Q4:19f 2019f

2,5 2,4 2,2 1,6 1,2 1,8 1,1 1,1 1,3 1,5 1,3

- 1,5 1,7 0,6 0,9 - 1,2 1,7 1,6 1,6 -

Private Consumption 1,7 2,1 0,8 0,5 0,7 1,3 1,0 1,3 1,3 1,2 1,0

Government Consumption 1,2 0,0 1,8 1,0 1,1 1,0 1,1 1,2 1,2 1,1 1,1

Investment 2,9 0,5 6,4 2,9 3,0 3,3 3,3 3,5 3,4 3,2 3,4

Inventories Contribution -0,1 0,7 -0,3 1,1 -0,5 0,1 -0,4 -0,2 -0,1 0,0 -0,1

Net Exports Contribution 0,8 -0,4 -0,1 -1,5 0,1 0,2 0,2 0,2 0,0 0,0 -0,1

Exports 5,4 -2,8 4,7 0,5 1,1 2,8 3,5 3,9 3,4 3,2 2,8

Imports 4,1 -2,2 5,4 4,0 0,9 2,7 3,4 4,0 3,6 3,5 3,3

Inflation 1,5 1,2 1,7 2,1 1,9 1,7 1,4 1,4 1,1 1,0 1,2

Real GDP Growth (QoQ saar) (2)

Euro AreaReal GDP Growth (YoY)

Real GDP Growth (QoQ saar)

a: Actual, f: Forecasts, 1. Seasonally adjusted YoY growth rate, 2. Seasonally adjusted annualized QoQ growth rate, 3. Year-to-year average % change

United States

Real GDP Growth (YoY) (1)

Economic Forecasts

Feb 8th 3-month 6-month 12-month Feb 8th 3-month 6-month 12-month

Germany 0,09 0,35 0,45 0,75 Euro area 0,00 0,00 0,00 0,00

US 2,64 2,70 2,80 3,00 US 2,50 2,50 2,50 2,75

UK 1,15 1,48 1,62 1,84 UK 0,75 0,75 0,85 1,05

Japan -0,03 0,07 0,08 0,11 Japan -0,10 -0,10 -0,10 -0,10

Currency Feb 8th 3-month 6-month 12-month Feb 8th 3-month 6-month 12-month

EUR/USD 1,13 1,15 1,16 1,18 USD/JPY 110 108 108 104

EUR/GBP 0,87 0,86 0,85 0,86 GBP/USD 1,29 1,33 1,36 1,36

EUR/JPY 124 125 126 123

10-Yr Gov. Bond Yield (%) Official Rate (%)

Forecasts at end of period

Interest Rates & Foreign Exchange Forecasts

NBG Global Markets Roundup | Economic News & Events Calendar


8


O F G R E E C E

rat

Tuesday 5 Wednesday 6 Thursday 7

US S A P US S A P US S A P

ISM non-manufacturing January 57.1 - 56.7 58.0 Trade balance ($bn) December -54.0 + -49.3 -55.7 Initial Jobless Claims (k) February 2 221 - 234 253

EURO AREA Continuing Claims (k) January 26 1733 - 1736 1778

Retail sales (MoM) December -1.6% -1.6 0.8% EURO AREA

Retail sales (YoY) December 0.5% + 0.8% 1.8%

UK

Markit/CIPS UK Services PMI January 51.0 - 50.1 51.2 GERMANY

Industrial Production (sa, MoM) December 0.8% - -0.4% -1.3%

Industrial Production (wda, YoY) December -3.4% - -3.9% -4.0%

JAPAN

Coincident Index December 102.2 + 102.3 102.9

Leading Index December 97.9 97.9 99.1

UK

Friday 8 Monday 11

JAPAN S A P UK S A P

Eco Watchers Current Survey January 48.3 - 45.6 46.8 GDP (QoQ) Q4:18 0.3% - 0.2% 0.6%

Eco Watchers Outlook Survey January 48.1 + 49.4 47.9 GDP (YoY) Q4:18 1.4% - 1.3% 1.5%

Government Spending QoQ Q4:18 0.5% + 1.4% -0.3%

Gross Fixed Capital Formation Q4:18 -0.1% - -0.5% 0.6%

Private Consumption (QoQ) Q4:18 0.3% + 0.4% 0.5%

Industrial Production (MoM) December 0.1% - -0.5% -0.3%

Industrial Production (YoY) December -0.5% - -0.9% -1.3%

Tuesday 12 Wednesday 13 Thursday 14

S A P US S A P US S A P

CPI (YoY) January 1.5% .. 1.9% Initial Jobless Claims (k) February 9 225 .. 234

Core CPI (YoY) January 2.1% .. 2.2% Continuing Claims (k) February 2 1740 .. 1736

EURO AREA Retail Sales Advance MoM December 0.1% .. 0.2%

EURO AREA

Employment (QoQ) Q4:18 .. .. 0.2%

Employment (YoY) Q4:18 .. .. 1.3%

GDP (QoQ) Q4:18 0.2% .. 0.2%

UK GDP (YoY) Q4:18 1.2% .. 1.2%

CPI (YoY) January 2.0% .. 2.1% GERMANY

CPI Core (YoY) January 1.9% .. 1.9% GDP (QoQ) Q4:18 0.1% .. -0.2%

GDP (wda, YoY) Q4:18 0.7% .. 1.1%

JAPAN

Friday 15 Monday 18 GDP (QoQ) Q4:18 0.4% .. -0.6%

US S A P S A P GDP Private Consumption Q4:18 0.7% .. -0.2%

Empire Manufacturing February 7.0 .. 3.9 GDP Business Spending (QoQ) Q4:18 1.8% .. -2.8%

Industrial Production (MoM) January 0.1% .. 0.3% CHINA

Exports (YoY) January -3.3% .. -4.4%

Imports (YoY) January -10.3% .. -7.6%

Mortgage delinquencies Q4:18 .. .. 4.47%

Mortgage foreclosures Q4:18 .. .. 0.99%EURO AREA

Trade Balance SA (€ bn) December 15.7 .. 15.1UK

Retail sales Ex Auto MoM January 0.2% .. -1.3%CHINA

Aggregate Financing (RMB bn) January 3300.0 .. 1589.8New Yuan Loans (RMB bn) January 3000.0 .. 1080.0Money Supply M0 (YoY) January 8.4% .. 3.6%Money Supply M1 (YoY) January 1.9% .. 1.5%Money Supply M2 (YoY) January 8.2% .. 8.1%CPI (YoY) January 1.9% .. 1.9%


S: Bloomberg Consensus Analysts Survey, A: Actual Outcome, P: Previous Outcome

Net Long-term TIC Flows ($ bn) December .. ..

University of Michigan consumer

confidenceFebruary 93.5 ..

Economic News Calendar for the period: February 5- February 18, 2019

ECB publishes its Economic

bulletin

BoE announces its intervention

rateFebruary 7

Bank of England Inflation Report

0.75%

Industrial Production (sa, MoM) -0.4% .. -1.7%

0.75% 0.75%

Industrial Production (wda, YoY)

December

December -3.3% .. -3.3%

91.2

37.6

Plenty macro events in the US this week, with CPI inflation data for

January, retail sales for December and industrial production for January,

gathering the most attention.

In the euro area, industrial production data for December will offer some

insight for the performance of business spending in Q4:18.

In the United Kingdom, CPI inflation data for January are released.

In Japan, attention turns to the announcement of GDP in Q4:18, which is

expected to have rebounded following a, negatively distorted by natural

disasters (earthquake, typhoons), contraction in Q3:18.

Economic Calendar

-0,5

0,0

0,5

1,0

1,5

2,0

2,5

3,0

-0,5

0,0

0,5

1,0

1,5

2,0

2,5

3,0

Jan

-13

Jul-

13

Jan

-14

Jul-

14

Jan

-15

Jul-

15

Jan

-16

Jul-

16

Jan

-17

Jul-

17

Jan

-18

Jul-

18

Jan

-19

Core CPI (YoY) CPI (YoY)% %


Forecasts

US Inflation

NBG Global Markets Roundup | Financial Markets Monitor


9


O F G R E E C E

Developed MarketsCurrent

Level

1-week

change (%)

Year-to-Date

change (%)

1-Year

change (%)

2-year

change (%)Emerging Markets

Current

Level

1-week

change (%)

Year-to-Date

change (%)

1-Year

change (%)

2-year

change (%)

US S&P 500 2708 0,0 8,0 4,9 18,0 MSCI Emerging Markets 56825 -0,9 6,4 -6,7 13,8

Japan NIKKEI 225 20333 -2,2 1,6 -7,1 7,0 MSCI Asia 839 -0,6 6,9 -9,0 14,7

UK FTSE 100 7071 0,7 5,1 -1,4 -1,6 China 79 -0,5 11,0 -12,8 23,7

Canada S&P/TSX 15633 0,8 9,1 3,8 0,5 Korea 652 -1,8 7,9 -9,7 8,7

Hong Kong Hang Seng 27946 0,1 8,1 -8,2 19,0 MSCI Latin America 92527 -2,0 7,1 4,4 21,9

Euro area EuroStoxx 345 -1,2 5,0 -7,9 -0,9 Brazil 313154 -2,5 8,4 13,7 39,8

Germany DAX 30 10907 -2,4 3,3 -11,0 -5,5 Mexico 40314 -1,3 4,1 -10,8 -9,0

France CAC 40 4962 -1,1 4,9 -3,7 4,1 MSCI Europe 5636 -1,2 6,2 1,4 12,7

Italy FTSE/MIB 19352 -1,1 5,6 -13,9 3,1 Russia 1133 -1,1 6,7 11,0 16,9

Spain IBEX-35 8857 -1,8 3,7 -9,2 -5,1 Turkey 1414605 -0,4 13,0 -9,8 14,0

Equity Markets (in local currency)

in US Dollar termsCurrent

Level

1-week

change (%)

Year-to-Date

change (%)

1-Year

change (%)

2-year

change (%)in local currency

Current

Level

1-week

change (%)

Year-to-Date

change (%)

1-Year

change (%)

2-year

change (%)

Energy 199,4 -2,1 9,1 -4,2 -4,5 Energy 205,2 -1,5 8,5 -1,1 -5,1

Materials 240,5 -2,1 5,6 -11,0 1,9 Materials 231,0 -1,4 5,4 -7,1 1,1

Industrials 240,5 -0,2 9,4 -5,8 9,6 Industrials 238,4 0,2 9,5 -3,4 8,2

Consumer Discretionary 237,1 -1,7 6,2 -2,3 17,2 Consumer Discretionary 229,1 -1,4 6,3 -0,6 15,7

Consumer Staples 220,1 0,5 5,4 -2,4 2,7 Consumer Staples 221,5 0,9 5,4 0,8 1,9

Healthcare 240,4 -0,8 4,6 8,4 20,5 Healthcare 238,4 -0,5 4,7 10,6 19,7

Financials 110,1 -1,1 6,8 -12,2 1,4 Financials 110,7 -0,5 6,6 -9,4 0,7

IT 233,9 1,5 9,9 8,4 35,9 IT 226,8 1,7 9,9 9,0 35,4

Telecoms 66,3 -0,5 7,4 -1,1 -3,7 Telecoms 69,3 -0,3 7,4 2,2 -4,8

Utilities 132,6 0,6 5,3 13,1 13,8 Utilities 136,1 1,1 5,3 16,1 12,6

World Market Sectors (MSCI Indices)

Current Last week Year StartOne Year

Back

10-year

average

Government Bond Yield

Spreads (in bps)Current Last week Year Start

One Year

Back

10-year

average

US 2,64 2,69 2,69 2,85 2,51 US Treasuries 10Y/2Y 17 18 20 78 164

Germany 0,09 0,17 0,24 0,75 1,43 US Treasuries 10Y/5Y 19 18 17 31 83

Japan -0,03 -0,01 0,00 0,07 0,61 Bunds 10Y/2Y 67 75 85 131 132

UK 1,15 1,25 1,28 1,57 2,23 Bunds 10Y/5Y 45 48 55 65 79

Greece 4,02 3,92 4,40 4,11 10,23

Ireland 0,87 0,89 0,90 1,14 3,89

Italy 2,96 2,75 2,74 2,04 3,39

Spain 1,23 1,22 1,42 1,48 3,27 EM Inv. Grade (IG) 189 187 213 138 238

Portugal 1,65 1,64 1,72 2,10 5,05 EM High yield 489 489 586 349 727

US IG 134 136 159 97 171

Current Last week Year StartOne Year

Back

10-year

averageUS High yield 432 429 533 382 563

30-Year FRM1 (%) 4,7 4,7 4,8 4,6 4,3 Euro area IG 139 143 154 78 155

vs 30Yr Treasury (bps) 0 166 183 141 104 Euro area High Yield 449 449 506 282 575

One Year

Back

10-year

average

Corporate Bond Spreads

(in bps)Current Last week Year Start

10-Year Government

Bond Yields

US Mortgage Market

(1. Fixed-rate Mortgage)

Bond Markets (%)

Current1-week

change (%)

1-month

change (%)

1-Year

change (%)

Year-to-Date

change (%)Commodities Current

1-week

change (%)

1-month

change (%)

1-Year

change (%)

Year-to-Date

change (%)

Euro-based cross rates

EUR/USD 1,13 -1,2 -1,9 -7,5 -1,3 Agricultural 355 -0,9 -1,3 -8,6 1,6

EUR/CHF 1,13 -0,6 0,7 -1,2 0,5 Energy 435 -2,4 0,5 -4,6 13,5

EUR/GBP 0,87 -0,2 -3,2 -0,7 -2,8 West Texas Oil ($) 53 -4,6 0,7 -13,8 16,1

EUR/JPY 124,25 -1,0 -0,5 -6,7 -1,1 Crude brent Oil ($) 62 -1,1 2,2 -3,5 16,3

EUR/NOK 9,78 1,2 0,0 0,7 -1,3 Industrial Metals 1245 -0,1 4,4 -11,3 4,8

EUR/SEK 10,50 1,3 2,6 5,6 3,5 Precious Metals 1560 -0,3 1,6 -1,1 2,6

EUR/AUD 1,60 1,1 -0,8 1,5 -1,8 Gold ($) 1315 -0,2 1,6 -0,3 2,5

EUR/CAD 1,50 0,2 -1,4 -2,6 -3,8 Silver ($) 16 -0,5 0,5 -3,5 2,2

USD-based cross rates Baltic Dry Index 601 -6,8 -51,5 -45,7 -52,7

USD/CAD 1,33 1,3 0,5 5,3 -2,7 Baltic Dirty Tanker Index 795 -5,7 -16,9 23,6 -36,5

USD/AUD 1,41 2,3 1,2 9,8 -0,5

USD/JPY 109,74 0,2 1,5 0,9 0,0

Foreign Exchange

Foreign Exchange & Commodities

Source: Bloomberg, as of February 8th, S&P/Goldman Sachs Indices for Agricultural, Energy, Industrial

& Precious Metals, BofA/ML Indices for Corporate Bond Spreads

NBG Global Markets Roundup | Chartroom


10


O F G R E E C E

Source: Bloomberg, NBG estimates, Cumulative flows since January 2014, AUM stands for Assets

Under Management, Data as of February 08th

Source: Bloomberg, NBG estimates, Cumulative flows since January 2014, AUM stands for

Assets Under Management, Data as of February 08th

Global Cross Asset ETFs: Flows as % of AUM Equity ETFs: Flows as % of AUM

Source: Bloomberg - Data as of February 08th – Rebased @ 100

Source: Bloomberg, Data as of February 08th

Source: Bloomberg - Data as of February 08th – Rebased @ 100


82

84

86

88

90

92

94

96

98

100

102

104

106

108

110

82

84

86

88

90

92

94

96

98

100

102

104

106

108

110

9-A

ug

23-A

ug

6-Se

p

20-S

ep

4-O

ct

18-O

ct

1-N

ov

15-N

ov

29-N

ov

13-D

ec

27-D

ec

10-J

an

24-J

an

7-Fe

b

S&P500 EuroStoxx FTSE 100 Nikkei 225

-10

-9

-8

-7

-6

-5

-4

-3

-2

-1

0

1

2

3

1240

1280

1320

1360

1400

1440

1480

1520

1560

1600

1640

1680

1720

1760

9-A

ug

23

-Au

g

6-S

ep

20

-Sep

4-O

ct

18-O

ct

1-N

ov

15

-No

v

29

-No

v

13

-Dec

27

-Dec

10

-Jan

24

-Jan

7-F

eb

Small Cap/Large Cap Relative Performance during the previous 6 months (right)Russell 2000-Small cap (left)Russell 1000-Large Cap (left)

Equity Market Performance - G4 Equity Market Performance - BRICs

Russell 2000 Value & Growth Index

Russell 2000 & Russell 1000 Index

-15-10-505101520253035404550556065

-15-10

-505

101520253035404550556065

Jan

-14

May

-14

Sep

-14

Jan

-15

May

-15

Sep

-15

Jan

-16

May

-16

Sep

-16

Jan

-17

May

-17

Sep

-17

Jan

-18

May

-18

Sep

-18

Jan

-19

DM Equities Bonds

EM Equities Commodities% %

84

88

92

96

100

104

108

112

116

120

124

128

84

88

92

96

100

104

108

112

116

120

124

128

9-A

ug

23-A

ug

6-Se

p

20-S

ep

4-O

ct

18-O

ct

1-N

ov

15-N

ov

29-N

ov

13-D

ec

27-D

ec

10-J

an

24-J

an

7-Fe

b

Brazil China Russia India

-4

-3

-2

-1

0

1

2

3

4

5

700

800

900

1000

1100

1200

1300

1400

1500

1600

1700

1800

1900

2000

2100

9-A

ug

23

-Au

g

6-S

ep

20

-Sep

4-O

ct

18

-Oct

1-N

ov

15

-No

v

29

-No

v

13-D

ec

27-D

ec

10

-Jan

24

-Jan

7-F

eb

Value/Growth Relative Performance during the previous 6 months (right)Russell 2000 Value (left)Russell 2000 Growth (left)

-15

-10

-5

0

5

10

15

20

25

30

35

-15

-10

-5

0

5

10

15

20

25

30

35

Jan

-14

May

-14

Sep

-14

Jan

-15

May

-15

Sep

-15

Jan

-16

May

-16

Sep

-16

Jan

-17

May

-17

Sep

-17

Jan

-18

May

-18

Sep

-18

Jan

-19

US Emerging Markets Europe exUK% %

NBG Global Markets Roundup | Chartroom


11


O F G R E E C E

Source: Bloomberg, Data as of February 08th Source: Bloomberg, Data as of February 08th

1,11

1,12

1,13

1,14

1,15

1,16

1,17

1,18

1,11

1,12

1,13

1,14

1,15

1,16

1,17

1,18

9-A

ug

23

-Au

g

6-Se

p

20

-Sep

4-O

ct

18

-Oct

1-N

ov

15

-No

v

29

-No

v

13

-Dec

27

-Dec

10

-Jan

24

-Jan

7-Fe

b

EUR-USD €/$€/$

Stronger USD

EUR/USD

JPY/USD

Source: Bloomberg - Data as of February 08th

LA:Left Axis RA:Right Axis


Source: Bloomberg - Data as of February 08th


-0,1

0,0

0,1

0,2

0,3

0,4

0,5

0,6

1,0

1,2

1,4

1,6

1,8

2,0

2,2

2,4

2,6

2,8

3,0

3,2

3,4

9-A

ug

23

-Au

g

6-Se

p

20-S

ep

4-O

ct

18-O

ct

1-N

ov

15-N

ov

29-N

ov

13-D

ec

27-D

ec

10-J

an

24-J

an

7-Fe

b

US (LA) UK (LA) Japan (RA) Germany (RA) %%

1.170

1.190

1.210

1.230

1.250

1.270

1.290

1.310

1.330

1.170

1.190

1.210

1.230

1.250

1.270

1.290

1.310

1.330

9-A

ug

23-A

ug

6-Se

p

20-S

ep

4-O

ct

18-O

ct

1-N

ov

15-N

ov

29-N

ov

13-D

ec

27-D

ec

10-J

an

24-J

an

7-Fe

b

Gold $/ounch$/ounch

10- Year Government Bond Yields 10- Year Government Bond Spreads

West Texas Intermediate ($/brl)

Gold ($/ounch)

107

108

109

110

111

112

113

114

115

107

108

109

110

111

112

113

114

115

9-A

ug

23-A

ug

6-Se

p

20-S

ep

4-O

ct

18-O

ct

1-N

ov

15-N

ov

29-N

ov

13-D

ec

27-D

ec

10-J

an

24-J

an

7-Fe

b

USD-JPY $/¥$/¥

Stronger JPY

50

100

150

200

250

300

350

50

100

150

200

250

300

350

9-A

ug

23

-Au

g

6-Se

p

20-S

ep

4-O

ct

18-O

ct

1-N

ov

15-N

ov

29-N

ov

13-D

ec

27-D

ec

10-J

an

24-J

an

7-Fe

b

Italy Portugal Spain bpsbps

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4042444648505254565860626466687072747678

9-A

ug

23-A

ug

6-Se

p

20-S

ep

4-O

ct

18-O

ct

1-N

ov

15-N

ov

29-N

ov

13-D

ec

27-D

ec

10-J

an

24-J

an

7-Fe

b

WTI $/brl$/brl

NBG Global Markets Roundup | Equity Market Valuation Metrics


12


O F G R E E C E

US Sectors Valuation

-7,0

-6,0

-5,0

-4,0

-3,0

-2,0

-1,0

0,0

1,0

2,0

Ind

ust

rial

s

Co

nsu

me

r St

aple

s

Co

ns

Dis

cret

ion

ary

Fin

anci

als

Re

al E

stat

e

Co

mm

Ser

vice

s

Hea

lth

Car

e

Uti

litie

s

S&P

50

0 IT

Mat

eri

als

Ener

gy

2019

12-month forward

%

1-month revisions to 2019 & 12-month Forward EPSEarnings Revisions indicate 1-month change in 2019 & 12-month Forward EPS

-15

-10

-5

0

5

10

15

Hea

lth

Car

e

Co

ns

Dis

cret

ion

ary

Ind

ust

rial

s

Uti

litie

s

S&P

50

0

Fin

anci

als IT

Ener

gy

Co

nsu

me

r St

aple

s

Re

al E

stat

e

Co

mm

Ser

vice

s

Mat

eri

als

2019

12-month forward

%


P/BV Ratio

8/2/2019 % Weekly Change 2018 2019 2018 2019 2018 2019 12m fwd 10Yr Avg 2018 2019 12m fwd 10Yr Avg

S&P500 2708 0,0 22,0 5,1 2,0 2,1 16,8 16,0 15,9 14,7 3,2 3,0 3,0 2,4

Energy 464 -3,3 109,3 -11,1 3,4 3,6 15,6 17,6 17,2 20,2 1,6 1,6 1,6 1,8

Materials 330 -1,5 20,8 -0,1 2,2 2,4 15,1 15,1 14,9 14,6 2,2 2,0 2,0 2,5

Financials

Diversified Financials 630 -2,3 34,6 2,4 1,6 1,7 13,6 13,2 13,1 13,9 1,7 1,6 1,5 1,4

Banks 307 -1,1 25,7 10,8 2,6 3,2 11,0 10,0 9,8 12,4 1,2 1,2 1,1 1,0

Insurance 379 -0,6 22,1 15,6 2,4 2,4 12,7 11,0 10,9 10,4 1,4 1,3 1,3 1,0

Real Estate 214 1,4 6,5 2,6 3,3 3,5 19,1 18,6 18,5 17,8 3,3 3,5 3,5 2,7

Industrials

Capital Goods 645 1,6 18,6 8,5 2,1 2,1 17,1 15,7 15,6 15,1 5,0 4,5 4,5 3,1

Transportation 740 1,3 26,3 14,9 1,8 2,0 14,7 12,8 12,6 13,9 4,3 3,7 3,7 3,2

Commercial Services 278 1,5 12,3 9,7 1,3 1,6 25,2 23,0 22,7 18,9 4,7 4,5 4,5 3,1

Consumer Discretionary

Retailing 2085 -0,6 38,4 13,5 0,8 0,9 28,7 25,2 24,9 19,7 11,0 9,3 9,1 5,2

Media 547 -0,1 24,9 5,6 0,4 0,5 22,6 21,4 21,1 18,6 4,0 3,4 3,4 3,0

Consumer Services 1097 0,3 20,1 8,4 2,0 2,2 21,1 19,4 19,2 18,5 11,5 13,3 13,3 5,4

Consumer Durables 322 1,2 13,6 7,3 1,6 1,7 17,6 16,4 16,2 16,8 3,6 3,4 3,3 3,0

Automobiles and parts 112 -2,7 -8,9 -1,5 4,6 4,2 7,1 7,2 7,1 8,7 1,4 1,3 1,2 1,8

IT

Technology 1091 1,8 17,1 1,9 1,9 2,1 14,6 14,3 14,1 12,5 5,9 5,8 5,8 3,1

Software & Services 1764 1,9 13,0 10,7 1,2 1,3 24,2 21,8 21,6 16,1 8,5 7,4 7,3 4,8

Semiconductors 918 1,2 27,5 -5,8 2,1 2,4 12,2 13,0 12,9 15,9 4,5 4,1 4,0 2,9

Consumer Staples

Food & Staples Retailing 409 0,3 11,7 3,3 2,0 2,1 18,7 18,1 18,0 15,5 3,9 3,7 3,7 3,0

Food Beverage & Tobacco 632 1,1 10,6 4,0 3,6 3,8 17,3 16,7 16,5 17,0 4,6 4,3 4,3 4,8

Household Goods 608 1,9 8,1 4,2 2,7 2,8 22,4 21,5 21,4 18,2 6,3 6,3 6,3 4,5

Health Care

Pharmaceuticals 875 -1,3 14,1 3,9 2,1 2,3 15,1 14,5 14,4 14,1 4,9 4,5 4,4 3,3

Healthcare Equipment 1185 -0,5 18,4 10,0 1,1 1,1 19,1 17,4 17,2 14,5 3,3 3,0 3,0 2,5

Communication Services 146 -1,5 18,6 0,6 5,9 6,0 9,8 9,7 9,7 12,7 1,7 1,6 1,6 2,3

Utilities 282 2,0 4,4 4,8 3,4 3,6 18,7 17,9 17,8 14,8 2,0 1,9 1,9 1,5

Source Factset, Blue box indicates a value more than +2standard devation from average, light blue a value more than +1standard devation from average. Orange box indicates a value less than -2standard devation from

average, light orange a value less than -1standard devation from average

EPS Growth (%) P/E RatioPrice ($) Dividend Yield (%)

Source: Factset, Data as of February 08th

12-month forward EPS are 89% of 2019 EPS and 11% of 2020 EPS



NBG Global Markets Roundup | Equity Market Valuation Metrics


13


O F G R E E C E

Euro Area Sectors Valuation

-6,0

-5,0

-4,0

-3,0

-2,0

-1,0

0,0

1,0

2,0

3,0

Trav

el a

nd

Lei

sure

Foo

d&

Bev

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e

Rea

l Est

ate

Med

ia

Ret

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Mat

eria

ls

He

alth

car

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Insu

ran

ce

Co

mm

Ser

vice

s

Ho

use

ho

ld G

oo

ds

Uti

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s

Ch

emic

als

Euro

Sto

xx

Ind

ust

rial

Au

tos

and

par

ts

Ene

rgy

Fin

/al S

ervi

ces

Ban

ks

Tech

no

logy

Bas

ic R

eso

urc

es

2019

12-month Forward

%


-12%

-20

-15

-10

-5

0

5

10

15

20

25

30

Ene

rgy

Bas

ic R

eso

urc

es

Rea

l Est

ate

Ho

use

ho

ld G

oo

ds

Insu

ran

ce

Med

ia

Ret

ail

Mat

eria

ls

Uti

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s

Foo

d&

Bev

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e

Ind

ust

rial

Co

mm

Ser

vice

s

Tech

no

logy

Euro

Sto

xx

Fin

/al S

ervi

ces

He

alth

car

e

Au

tos

and

par

ts

Ban

ks

Trav

el a

nd

Lei

sure

Ch

emic

als

2019

12-month Forward

%


8/2/2019 % Weekly Change 2018 2019 2018 2019 2018 2019 12m fwd 10Yr Avg 2018 2019 12m fwd 10Yr Avg

EuroStoxx 345 -1,2 -0,4 9,6 3,5 3,7 14,4 13,1 13,0 13,0 1,5 1,5 1,4 1,4

Energy 323 -0,1 25,9 6,5 4,8 5,0 12,0 11,3 11,2 11,3 1,2 1,2 1,2 1,2

Materials 387 -0,9 4,6 13,4 3,6 3,9 14,1 12,5 12,3 14,0 1,6 1,5 1,4 1,4

Basic Resources 200 -2,7 23,5 -11,8 3,2 3,6 7,5 8,5 8,5 15,8 0,8 0,8 0,8 0,9

Chemicals 947 -2,2 -6,1 -1,2 3,1 3,2 15,5 15,7 15,5 14,7 1,8 1,8 1,8 2,2

Financials

Fin/al Services 414 -2,9 5,6 8,1 2,8 3,0 15,5 14,3 14,2 13,6 1,3 1,2 1,2 1,2

Banks 89 -1,6 3,3 4,2 6,2 6,5 8,2 7,9 7,8 10,4 0,6 0,6 0,6 0,7

Insurance 258 -0,8 10,2 10,9 5,4 5,8 10,5 9,4 9,4 9,1 1,0 0,9 0,9 0,9

Real Estate 236 -1,3 15,5 6,0 4,5 4,8 17,8 16,8 16,7 16,7 1,0 1,0 0,9 1,0

Industrial 753 -2,1 2,4 17,3 2,8 3,0 18,2 15,5 15,3 14,9 2,6 2,4 2,4 2,2

Consumer Discretionary

Media 217 -3,1 2,6 7,4 4,1 3,9 16,7 15,6 15,4 15,0 2,1 2,1 2,1 2,0

Retail 499 -0,2 12,6 10,0 2,8 3,0 20,7 18,8 18,6 17,9 3,1 2,9 2,9 2,6

Automobiles and parts 441 -7,3 -9,7 7,7 4,5 4,8 7,0 6,5 6,4 9,3 0,9 0,8 0,8 1,0

Travel and Leisure 186 -0,9 -13,0 6,4 2,1 2,3 11,3 10,6 10,5 35,1 1,8 1,6 1,6 1,8

Technology 469 0,8 1,7 8,3 1,6 1,8 20,5 19,0 18,7 17,9 3,4 3,2 3,1 2,8

Consumer Staples

Food&Beverage 541 0,9 5,3 15,3 2,3 2,4 21,0 18,2 18,0 17,8 2,5 2,3 2,3 2,6

Household Goods 858 0,8 10,3 9,7 1,9 2,1 24,7 22,5 22,3 19,6 5,1 4,6 4,6 3,4

Health care 732 -0,4 -5,9 9,5 2,5 2,6 17,6 16,1 15,9 14,4 2,1 2,0 2,0 2,1

Communication Services 280 -1,9 -9,5 9,8 5,1 5,4 14,2 12,9 12,8 13,2 1,7 1,6 1,6 1,7

Utilities 299 -0,7 -24,2 34,9 4,6 4,9 20,1 14,9 14,7 12,2 1,5 1,4 1,4 1,1

P/E RatioPrice (€) P/BV RatioDividend Yield (%)EPS Growth (%)

Source Factset, Blue box indicates a value more than +2standard devation from average, light blue a value more than +1standard devation from average. Orange box indicates a value less than -2standard devation from

average, light orange a value less than -1standard devation from average





NBG Global Markets Roundup | Disclosures & Analyst Certification


14


O F G R E E C E

DISCLOSURES:

This report has been produced by the Economic Research Division of the National Bank of Greece, which is regulated by the Bank

of Greece, and is provided solely as a sheer reference for the information of experienced and sophisticated investors who are

expected and considered to be fully able to make their own investment decisions without reliance on its contents, i.e. only after

effecting their own independent enquiry from sources of the investors’ sole choice. The information contained in this report does

not constitute the provision of investment advice and under no circumstances is it to be used or considered as an offer or an

invitation to buy or sell or a solicitation of an offer or invitation to buy or sell or enter into any agreement with respect to any

security, product, service or investment. No information or opinion contained in this report shall constitute any representation or

warranty as to future performance of any financial instrument, credit, currency rate or other market or economic measure. Past

performance is not necessarily a reliable guide to future performance. National Bank of Greece and/or its affiliates shall not be

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Any data provided in this report has been obtained from sources believed to be reliable but has not been independently verified.

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timeliness or usefulness of any information. Information and opinions contained in this report are subject to change without

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and its affiliate companies, its representatives, its managers and/or its personnel or other persons related to it, accept no

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The research analyst denoted by an “AC” on page 1 holds the certificate (type Δ) of the Hellenic Capital Market Commission/Bank

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Documents

National Bank of Greece | Economic Research Division ... · bps to 0.09% (the lowest level since late 2016). We have turned short duration tactically, albeit we acknowledge that incoming