1. Crypto ETFs swept the board in October
Our monthly round-up of the best and worst performing European exchange-traded products reveals a clean sweep for cryptocurrencies in the top 20, while natural gas and Brazilian ETFs were bottom of the pile. The Top 20 list of ETPs was led in October by SEBA Polkadot ETC (SDOT), launched back in July on the SIX Swiss Exchange by issuer SEBA Bank.
2. China is talking tough on coal
The COP26 climate conference closes today, and while the Morningstar assessment is that it can tentatively be described as a success, a lot rests on some big promises. An accord reached by the US and China on reducing emissions seems to be a real bright spot, though China’s own pledge to switch away from constructing new coal-fired power stations will be easier said than done. The country is already in the midst of a coal crisis, and shortages are impacting other countries in the region reliant on the commodity.
3. UK growth looks decidedly dicey
UK gross domestic product (GDP) growth may be in the middle of a bounceback from the dark days of 2020’s lockdowns, but we are not out of the woods just yet. New figures released this week by the Office for National Statistics showed GDP grew 1.3% between July and September 2021. That compares with 5.5% growth in the second quarter of this year (April to June). GDP is now 2.1% below pre-pandemic levels.
4. Elon Musk is at it again
Whether it amounted to trolling or just an extraordinary “flex”, Tesla CEO Elon Musk’s decision to offload around $5 billion of the car maker’s stock raised yet more eyebrows this week. More than three-and-a-half million votes were cast in a Twitter poll launched by the 50 year-old, with a 57.9% majority for the “sell” option. Filings this week showed the entrepreneur had kept his word and sold, though there is no doubt the episode generated as much interest in his tax affairs as his net worth.
5. Britcoin might actually happen
Britcoin could be a thing. According to a statement from government officials this week, the Treasury and Bank of England will consult next year on the introduction of a new central bank digital currency. The move could help businesses making cross-border payments, though it could also pose serious disruption for high street lenders, who may have to charge consumers for basic banking services to make up for lost revenue.
6. IPOs are just the start of the story
As our analysis of The Hut Group’s bumper flotation and subsequent fall from grace in the markets this week shows, the UK is sorely lacking successful IPOs that pay off in the longer term for investors. The Hut Group was a stock market darling when it floated in September last year, but 14 months later investors in the company face difficult decisions. Read our take on what went wrong here.
7. It’s still early days for climate investing
Microsoft founder Bill Gates may have generated some headlines by saying that the “FAANG” stocks of the future would be climate technology companies, but we are a long way from seeing that theory come to fruition. As Morningstar data journalist Sunniva Kolostyak shows in this piece, investors would be wise to approach climate fund investing with real caution, as that particular corner of the ESG world is still young.
8. It's not all mergers and acquisitions
In the first half of this year many column inches were devoted to the role of private equity firms, whose role in buying up businesses and consolidating them set the tone for 2021. But there are business break-ups too, and none was more significant this week than General Electric, whose proposed breakup marks a historic moment in US business.
9. There's a new EV kid on the block
After its stunning 2020, you could be forgiven for associating the topic of electric vehicles with one brand alone: Tesla. But there is a new kid on the block in the form of Rivian (RIVN), an electric vehicle manufacturer aiming to make SUVs more sustainable. When it floated this week, the company’s shares raced to more than 50% of their original pricing in just two days. Morningstar data journalist Mary Giles examines what might happen next in this piece.
10. Luxury brands’ growth is not in the bag
This week we examined a major new report on the luxury goods sector written by Morningstar senior equity analyst Jelena Sokolova. In it, she argues luxury brands should have no cause for complacency, as they face up to changing cultural norms in China, and what could amount to more muted demand in the US. To watch the video explaining the report, click here.
