Summary
Asia and the energy shock
Asia is exposed to the Middle East conflict and the resulting rise in oil and gas prices. Most countries in the region are net energy importers (Malaysia is a notable exception). Even if the pass‑through to headline inflation remains limited, sustaining cost‑of‑living support to shield household purchasing power will be expensive for governments.
Asia and the energy shock
The energy test for European sectors
We believe that European companies’ Q1 earnings should remain relatively robust. As the Iran conflict only started at the end of February, the impact is likely to be more visible in Q2 reporting and beyond; while the pullback in share prices so far have mostly been due to valuation multiple de-rating from a higher equity risk premium given the uncertain outlook.
The energy test for European sectors
Gold: a correction driven by positioning, not fundamentals
Gold has undergone a meaningful sell-off in recent weeks, but we believe the move has been driven more by a repricing of short-term macro fears than by any deterioration in the metal’s medium-term fundamentals.
Gold: a correction driven by positioning,...
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