zeb/market flash (Issue 3 – October 2012)

zeb.market.flash provides an overview of the performance of the world’s largest banks (measured by market capitalisation). The relevant factors are briefly and concisely described, analysed and classified by our experts. For our analyses, we take a close look at relevant indicators for the valuation of the capital market, such as stock returns, as well as macroeconomic and bank-specific drivers. This issue (Q3 2012) deals with Q3 2012, market volatilities and uncertainties.  What’s in it for you?

Global economic climate

  • The global economic environment got worse as GDP growth rates and forecasts declined around the globe
  • ECB support promote Western European sovereign CDS spreads significantly – decline of 50% within one quarter only

Key banking drivers

  • In Q3 2012, market volatilities and uncertainties clearly calmed down – the euro recovered moderately
  • The interbank funding situation improved considerably with positive effects on the banks’ margins

State of the banking industry

  • Central bank support in Europe and the US boosts banks’ equity performances in these regions with double-digit TSR figures outperforming BRICS countries in Q3 2012
  • Impact also visible on debt side as average CDS spreads of banks declined significantly and series of rating downgrades was brought to an end despite weaker economic conditions

Picture: La Défense, Paris

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