Investment Outlook: Investments when the financ...

Last spring the eyes of the world were focused on the financial problems of
European governments. A tougher existence has already become a reality for
citizens of the affected countries, led by Greece. Despite forceful budget
tightening, the outlook for the economy and financial markets still appears
uncertain. This is primarily due to a series of microeconomic data turning out
surprisingly weak, especially in the United States. But there are also
circumstances that are brightening the global economic picture. We find these in
a number of emerging markets, as well as in the Nordic countries and elsewhere.
There are thus opportunities to pursue, provided that we use a selective
approach.

Nervous financial markets are now gazing across the Atlantic. The US has lost
some of its dynamism and is weighed down by weak government finances. Both
politicians and economists are divided as to whether the US economy actually
needs more stimulus, or whether the time has come for belt-tightening. President
Obama is plagued by declining public support. Since last spring, financial
markets have occasionally been characterised by anxiety and accompanying
indecisiveness. At times this summer, markets have thus experienced abrupt price
fluctuations.

"These worries are justified, even though we believe that the probability of a
US double dip recession is low. In a historical perspective, events are actually
following a rather common pattern. It is more of a rule than an exception, that
an initially rapid cyclical upswing is followed by a deceleration, similar to
what is now happening in the US − a kind of double dip without a recession. But
the fact remains that the US has undergone a period of slow growth. What is now
needed is for underlying economic demand − demand that is not due to inventory
effects and fiscal stimulus − to kick in, and for the economy to stand on its
own feet. But the American consumer is still not going to be as eager to go
shopping as we have become accustomed to; that is certain," says Lars Gunnar
Aspman, Global Head of Macro Strategy at Private Banking.

Financial markets must therefore deal with a mixed scenario. The world economy
is more complex than before, with rapid growth in emerging economies and debt
problems in mature industrialised countries. The economic world is thus divided
− dualistic − and will remain so during the foreseeable future. Meanwhile there
are more investment alternatives than ever, according to Hans Peterson, CIO
Private Banking and Global Head of Investment Strategy, provided we use a
selective approach and are convinced that reasonable valuations are important
and that no double dip recession will materialise. We expect the emerging
markets sphere to show economic growth of 6-6.5 per cent annually during the
next couple of years, compared to about 2 per cent in the West. This is an
argument for investments in emerging markets, and Western companies with
exposure to these countries should also benefit in the years ahead.

"From an investment perspective, the key concepts at present are low valuations,
exposure to emerging markets, the liquidity of companies and a continued
selective approach. We should remember that the Nordic countries are in a
favourable position, both in terms of sound government finances and economic
outlook. The quarterly reports of companies this summer were also remarkably
good. Another thing to bear in mind is that because of the globalisation wave
during the past decade, companies and their share prices are less directly
connected to the economy of their 'homeland'. But it is clear that emerging
economies will continue to grow rapidly and will increasingly trade with each
other, and that demand from the old OECD industrialised countries will decline
in global importance," Mr Peterson concludes.

Watch the film clip at SEB Newsroom where Hans Peterson tells more about
Investment Outlook.
Full Report to be picked up at:www.sebgroup.com, and SEB Newsroom.


For further information, please   Press contact
contact                           Elisabeth Lennhede, Press & PR
                                  [phone]
Hans Peterson                     [e-mail]
CIO Private Banking and global
head Investment Strategy
[phone]

Lars Gunnar Aspman
Senior analyst, Investment
Strategy
[phone]



SEB is a leading Nordic financial services group. As a relationship bank, SEB in
Sweden and the Baltic countries offers financial advice and a wide range of
financial services. In Denmark, Finland, Norway and Germany the bank's
operations have a strong focus on corporate and investment banking based on a
full-service offering to corporate and institutional clients. The international
nature of SEB's business is reflected in its presence in 20 countries worldwide.
On 30 June 2010, the Group's total assets amounted to SEK 2,318bn while its
assets under management totalled SEK 1,328bn. The Group has about 20,000
employees. Read more about SEB at www.sebgroup.com.


[HUG#1444168]





Investment Outlook: 


http://hugin.info/1208/R/1444168/387981.pdf

Press release PDF : 


http://hugin.info/1208/R/1444168/387980.pdf




This announcement is distributed by Thomson Reuters on behalf of 
Thomson Reuters clients. The owner of this announcement warrants that: 
(i) the releases contained herein are protected by copyright and 
    other applicable laws; and 
(ii) they are solely responsible for the content, accuracy and 
     originality of the information contained therein. 
    
Source: SEB via Thomson Reuters ONE