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November 10th - Some Wall Street strategists believe that strong corporate earnings will drive a U.S. stock market rally in 2026, and the risks surrounding the uncertain interest rate outlook will prove to be temporary. Morgan Stanleys Michael Wilson stated that there are "clear signs" of an ongoing earnings recovery, and U.S. companies are enjoying better pricing power. He also noted that earnings expectation revisions have bottomed out. In a report, Wilson wrote, "While Federal Reserve guidance and the impact of the government shutdown have put pressure on recent stock price movements, these are merely temporary headwinds before a solid 2026 driven by earnings growth." A Citi index shows that since mid-October, more analysts have raised valuations than lowered them. Market focus now shifts to Nvidias earnings report next week for clues about artificial intelligence trends.Jefferies: Raises its target price for Arm (ARM.O) from $173 to $205.On November 10th, JPMorgan analysts wrote in a report that European luxury goods groups showed some positive signs in the third quarter, with a sequential improvement compared to the previous quarter. Analysts stated that investors welcomed these better results, and share prices performed strongly throughout the earnings season. However, they added that the market lacks a clear turning point because Asian demand remains volatile and questions persist about US spending during the peak sales season. The analysts believe, "We think luxury goods stocks need to see a real upgrade, which really requires better underlying improvement to support this positive performance." Furthermore, they noted that market polarization remains high, putting brands with strong momentum in a more advantageous position overall.Russian Ministry of Defense: Russian troops have captured the Nove and Hnativka regions in eastern Ukraine.With the U.S. government shutdown expected to end, some airline stocks rose in pre-market trading. American Airlines (AAL.O) rose 1.32%, United Airlines (UAL.O) rose 1.94%, and Delta Air Lines (DAL.N) rose 1.5%.

Sources: China Will Propose New Measures to Fight "Greenwashing"

Aria Thomas

Dec 21, 2022 11:37

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As part of its efforts to rein in 'greenwashing' in the world's second-largest climate fund market, China aims to tighten regulations on so-called green funds, according to sources with direct knowledge of the situation.


The new guidelines, which might be implemented in the first half of 2023, will represent a significant shift in a fast expanding segment of the Chinese funds business, where asset managers now have discretion over the scope of green investments.


The regulations could have an impact on some or the majority of the green funds that make up the majority of the 160 sustainable products currently available in China, requiring them to substantiate their green claims or drop the popular label, potentially slowing strong flows in a sector that has raised tens of billions of dollars in recent years.


Currently, China's green funds only operate within the 2018-implemented wide investment criteria and lack a mandatory labeling scheme. End of September, these funds had $34 billion in assets, according to data from Morningstar.


Asset Management Association of China (AMAC), the country's funds regulator, has drafted regulations requiring mutual funds and exchange-traded funds to have at least 60 percent of their assets in the defined green investments category in order to be eligible for sale as green products, according to sources.


Under the term 'greenwashing,' funders make inflated or unconfirmed sustainability claims.


The guidelines of AMAC would be subject to final approval by the China Securities Regulatory Commission (CSRC), according to unnamed sources who were not authorized to discuss the matter.


AMAC and CSRC did not respond to calls for comment from Reuters.


China's ambitions come at a time when regulators in the European Union, United States, and the United Kingdom are intensifying their scrutiny of asset managers that profit from the increasing demand for funds with environmental, social, and governance (ESG) credentials.


China, the world's largest producer of greenhouse gasses, has made climate transition a top priority. China's climate fund assets grew exponentially in 2020 and 2021 from a modest basis after President Xi Jinping declared that China will be "carbon neutral" by 2060.


Last year, China surpassed the United States to become the second largest climate fund market in the world, behind Europe, according to Morningstar, which gathers worldwide ESG fund statistics.


In the first nine months of this year, 43 climate-themed funds were introduced in China, a 30% increase from the end of 2020.


In the past two years, more than a handful of international asset managers, like BlackRock (NYSE:BLK) and Fidelity International, whose overseas funds are already compliant with green criteria, have entered China.


To identify green assets, AMAC's proposed guidelines borrow from the 2021 edition of China's green bond catalog, a quasi-classification scheme. Currently, the catalog is solely applicable to debt finance.


According to the proposed suggestions, investments in cataloged programmes, such as energy-saving and sustainable infrastructure projects, will be considered green investments.

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