In the U.S.:
- Articles of Impeachment were finally sent to the Senate this week to start the third impeachment trial of a US President in US history. The main contentious issue is if the Republican led Senate will allow witnesses to testify in the trial or seek to bury the issue all together to protect President Donald Trump.
Equinix, Inc. (EQIX) announced the acquisition of Packet for an undisclosed amount. Equinix disclosed that the acquisition will accelerate the company’s strategy to help enterprises more seamlessly deploy hybrid multicloud architectures on Platform Equinix and extract greater value from the platform’s rich ecosystems and global interconnection fabric.
- Q4 GDP growth was steady at 6.0% y/y. 2019 GDP expanded 6.1%, which was the weakest in 29 years. December industrial output expanded to 6.9%y/y versus November’s 6.2% reading.
- China and the US have signed a Phase 1 trade deal. Both parties were optimistic on the deal’s terms although some skepticism remained regarding China’s ability to execute on the agricultural purchases highlighted in the deal.
- December Domestic CGPI climbed to 0.90% y/y versus November’s 0.10% y/y reading. Japan will likely be the beneficiary of a boost in production as trade fears subside due to the phase 1 deal signed this week between the US and China.
The Hong Kong Times reported that CK Asset is in talks to buy out its Chinese partner’s, Herun Group, 40% stake in the Upper West Shanghai project. The project was valued at 20B yuan in May 2019.
- The NY Times highlighted potential for an escalation in US-EU trade tensions following “phase one” deal’s signing this week. New European Trade Commissioner Phil Hogan spoke in Washington on Thursday, expressing hope for the two sides to resolve issues but also vowing to “robustly defend European interests. Hogan was critical of Trump’s trade policies and threatened to bring US-China trade deal to the WTO for possible violation of global trading rules.
- Eurozone November Industrial production was 0.20% m/m versus October’s revised 0.90% m/m reading. The rise in industrial production helped boost the expectation that the Eurozone has reached the bottom and is poised for a rebound.
German listed Alstria Office REIT-AG issued a press release this week indicating that the year end 2019 valuation of its real estate portfolio conducted by the independent appraiser Savills Advisory Services Germany will result in a positive effect on Alstria’s full year 2019 income statement of approximately €450 mn (€2.53/sh) as a result of revaluation gains. Approximately €199 million (€1.12/sh) has already been booked in the first half of 2019. No detail was provided in the released as to what were the main drivers behind the portfolio revaluation gain of approximately €250 mn in the second half of 2019 (i.e. leasing, occupancy and/or yield compression). Alstria will report it full year results for 2019 in February 2020.
The views expressed in this update are as of the date of this blog entry. These views and any portfolio holdings discussed in the update are subject to change at any time based on market or other conditions. The adviser disclaims any duty to update these views, which may not be relied upon as investment advice. In addition, references to specific companies’ securities should not be regarded as investment recommendations or indicative of the Adelante products, strategies, or portfolios.