Sam Benstead

Quilter's managed assets rise on higher third-quarter inflows, shares jump Shares of British wealth manager Quilter rose almost 9% on Wednesday after it reported a rise in third-quarter assets under management, as more clients poured money into its funds, taking net inflows to 1.4 billion pounds ($1.82 billion). While Quilter enjoyed a strong quarter, worries about potential changes to taxation and pension funds during finance minister Rt Hon Rachel Reeves' Autumn budget at the end of the month have dampened client confidence. CEO Steven Levin told Reuters that the company remains optimistic about the future even though the market is expecting a tough budget, adding that ambiguity about where the pain is going to be felt has left clients unsure of their next moves. Quilter's net inflows were well above quarterly expectations and equivalent to current consensus for the whole of the second half of the year, Panmure Liberum analyst James Allen, ACA CFA said. Read more at Reuters

8

The Bank of England held interest rates last week as inflation remains more persistent than expected. A cautious move to balance inflationary pressures while supporting economic stability 💷📉 https://lnkd.in/e4rku5dr #BankOfEngland #InterestRates #Inflation #Economy #MonetaryPolicy #FinanceNews #UKEconomy #FinancialMarkets #BOE #RateHike #StickyInflation #EconomicOutlook #InterestRateHold #UKInflation #GlobalEconomy #InflationPressure #UKFinance #CentralBank #EconomicPolicy #InflationControl #InvestmentNews #RateDecision #EconomyUpdate #FinancialStability #EconomicTrends

6

Two of my outlook stories - on big UK banks' profits and big investment banks' fee growth in 2024 - were published today. Both feature Visible Alpha estimates data, showing which banks are likely to benefit the most from 1) fewer-than-expected rate cuts and 2) rising M&A and capital markets activity this year. Expectations for 2025 are positive with many open questions on future US policies and their impact on markets and the global economy. If you'd like to venture a guess on the direction of business next year, get in touch. There's plenty to discuss. #2024outlook #banks #profitoutlook #investmentbanking #sectoroutlook UK banks' 2024 profit outlook: Barclays, NatWest set to outshine peers https://lnkd.in/eyjw5rwg UBS, Deutsche Bank to lead 2024 investment banking fee growth among global peers - https://lnkd.in/enJGADjh

20

4 Comments

Package yes, but need to get the cost of equity right Ofwat’s PR24 Draft Determinations are open to consultation and Ofgem has recently published its SSMD for RIIO-3 for gas distribution, gas transmission, and electricity transmission. Price controls should be viewed as a package, but that said, the cost of equity is an important component and one which attracts considerable scrutiny. Utility Week’s Thomas Grimwood discusses it in a recent article “The million-dollar question’: Are regulators getting the cost of equity right”, in which I was delighted to be able share a few of my thoughts. Link to the article below. https://lnkd.in/e3atNp25

11

This is an impressively strong position from Rt Hon Rachel Reeves. The sector and broader City have been increasingly concerned that this was an idea that might happen due to apparent public finance benefits. But the complexity and risks of colossal unintended consequences could have risked market chaos and not helped public finances. Which is why it hasnt yet been attempted despite the pressure. Santander UK gave evidence to the HMT select committee where Mike Regnier pointed out that a near identical amount we raised from such interest was passed straight on to savers. This is the transmission mechanism of Monetary Policy. There is a lot more to this than meets the eye. When setting the system up in crisis Alastair Darling planned for the proceeds to be set aside in good times and the pot run down when the cycle turned as now so net neutral as a policy on public finance but a boost in crisis to the macro economy. Unfortunately one of his successors raided the pot. Anyway, Rachel Reeves is showing very encouraging signs of intellectual and politiical strength of purpose which is good for us all in uncertain times. Not unlike Mr Darling who is much missed. Santander UK Santander

27

Is Fundsmith's fee getting harder to justify? I'm a big believer in funds passing on the economies of scale to their investors as they grow, and many firms have been really good at this in recent years. So why, with assets of about £25 billion, is Fundsmith Equity still charging 1.04%? This week's column asks whether a pricey fee, coupled with a period of underperformance, is the reason for outflows from the fund. #fundsmith #investmentfees https://lnkd.in/eWq7Uen4

15

3 Comments

Exciting new development at Schroders Capital, building on the technology evolution across the Schroders Group which has been actively deploying generative #AI across the business for a substantial period of time. We're today unveiling our Generative AI Investment Analyst (GAiiA) platform which helps the investment team screen large volumes of data, thus speeding up research into current and potential investments. Developed by Schroders Capital’s data science and investment teams, it streamlines the private equity investment process, allowing Schroders Capital’s investment professionals to analyse even more investments and reallocate more of their time on adding value through direct interactions and strategic decisions with target and existing investments. Read more here: https://lnkd.in/evJ_bSkb #artificialintelligence #datascience #privateequity #privatemarkets #innovation #SchrodersCapital

20

The gilts market is getting a bit antsy again, as economic data feed stagflation worries. UK/Germany spread tops Liz Truss level to reach highest since 1990 Asset managers say debt sustainability will become a concern if borrowing costs swing yet higher

28

Market brief - 14th Oct The Government’s Investment Summit will go ahead today after some back-channel diplomacy from Starmer after Louise Haigh described P&O as a "rogue operator" last week. The Summit will now bring together hundreds of global investors and showcase how Britain is “open for business”. Inflation data is due out on Wednesday. Headline inflation is around 1.9% in September, which would be the first time in three years that it is under 2%. The market is a little unsure about the next MPC meeting, but if inflation drops below 2%, it should encourage the doves to bring another rate cut back into focus. Powell may declare victory over inflation this week. Despite the slightly disappointing CPI data last week, the payrolls data showed strong job growth and some feel Powell is clear to claim the soft landing and take a slow and steady approach to cutting rates over the next 12-18mths.  GBP kicked off around 1.3065 against USD, 1.1960 against EUR and EURUSD was around 1.0925 on the open #Finance #FxPlew #news

29

1 Comment

Would you take a risk on a brand new fund? 60% of fund selectors told us they would not. Indeed, there are a number who would need to see more than three years track record and over €100m before backing a strategy. Sure, some of that will be to do with size and ownership risk. But our pan-European survey sheds light on a topic many asset managers have felt instinctively to be true: its getting not any easier to launch new products. Is that a bad thing? Maybe, maybe not. Read our survey of 130 European selectors exclusively on Citywire Selector #citywireselector #fundbuyer #fundselector #report #productlaunch #investment #assetmanagement

25

7 Comments

The S&P500 used to be just 3 Sectors (Industrials, Utilities, Rails) Now that number is 11 (and n.b. Telecoms have been rebranded/evolved/shuffled into Communication Services) Makes you ponder what new sectors may come in the future, but also the need to dig into what actually is in the sectors you're investing in (e.g. big tech names being re-shuffled out of Information Technology into Consumer Discretionary and Communication Services) and the tendency for sector changes and shuffles and evolutions over time.. #stockmarket #investing #markets #equities

5

UK inflation was about as expected, but is likely to keep the Bank of England in super-cautious mode on cutting interest rates for some time yet. Investors are only fully pricing two cuts next year, not good news for mortgages in the short-term. A few elements that impacted this report: -the measure of how much it costs to live in and maintain one's own home rose to the highest annual level since 1992 -tobacco prices rose because of an increase in duties in the budget -lots of food staples are falling -- rice, pasta, fish -- though inflation on olive oil, for example, is still very high That and much more on Markets Today #inflation #ukinflation #ukeconomy https://lnkd.in/eaPTnxrG

9

Rachel Reeves's speech today was short on policy, as one might expect from a party conference, and heavy on priorities like industrial investment and growth. No great moves in markets at all in response. Really, however, this is just the start of the road to the budget in October. That's when the detail on policy will come for investors to digest and assess, with today much more about trying to raise the gloomy mood. Between now and then, the challenge will be ensuring investors think the plans are credible to keep the brightening view toward the UK that's emerged recently on track. That, plus the pound, positivity on UK retailers and a new offer for Rightmove in Markets Today #rachelreeves #markets #economy #uk https://lnkd.in/euH6QP23

2

A very safe pension manifesto from the political party most likely (as things currently stand) to win the next election... Key pension points: Labour will: · Act to increase investment from pension funds in UK markets · Adopt reforms to ensure that workplace pension schemes take advantage of consolidation and scale, to deliver better returns for UK savers and greater productive investment for UK PLC. · Undertake a review of the pensions landscape to consider what further steps are needed to improve pension outcomes and increase investment in UK markets. · Review the “unfair” surplus arrangements of the Mineworkers' Pension Scheme and transfer the Investment Reserve Fund back to members. · Mandate UK-regulated financial institutions – including asset managers, pension funds, and insurers – to develop and implement credible transition plans that align with the 1.5°C goal of the Paris Agreement. · Retain the triple lock for the state pension. · Adopt reforms to workplace pensions to deliver better outcomes for UK savers and pensioners. Read our article here: https://lnkd.in/epndmBET

52

11 Comments

The UK cannot regulate its way to being a transition finance superpower without also putting policies in place to grow investment opportunities, respondents to the Transition Finance Market Review have said. Among the respondents was the PRI, which said that regulation alone “is unlikely to mobilise the required capital on transition finance", while one bank told us that "transition finance discussions often wrongly focus largely on defining and measuring transition finance. But if it doesn’t make commercial sense for a company to transition, then there is no transition activity to finance". Firms and industry bodies were also less than keen on a prescriptive transition taxonomy, warning that the fluid nature of transition investments makes for a difficult classification system. https://lnkd.in/e7ctwxFj

18

2 Comments

NEW: We look at which stock sectors could benefit as the BoE begins what's expected to be a succession of rate cuts this and next year. https://lnkd.in/ethdBBsT

4

It's far from easy being an emerging manager in today's PE landscape. The firms featured in this list have managed to carve a niche for themselves, with a focus on creating value in high-opportunity markets – in what has been the most challenging of times! Read about all the specialisms here. #privateequity #emergingmanagers

16