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Our briefing for Wednesday, March 23, 2022:
Mar 23, 2022 4:02:15 PM
- In the United States, government data now shows that one in three Covid-19 cases are caused by the BA.2 subvariant, though overall infections are still on the decline. In New York, New Jersey and Massachusetts, BA.2 now makes up more than half of all cases, according to the Centers for Disease Control and Prevention (CDC). As of March 19, the seven-day average of Covid-19 cases was 27,747, down 18% from a week earlier. As per the CDC’s new guidelines that prioritize hospitalizations over case counts, most of the country is at a low transmission rate. Experts note that the U.S. tends to lag behind the U.K. for about three weeks, so an uptick in BA.2 cases would start to show in about a week or so.
- In Canada, as restrictions continue to lift across the provinces, many unvaccinated residents are frustrated that they still can’t board planes or trains. Canada’s vaccine mandate came into effect in November 2021, preventing unvaccinated people from boarding commercial planes or trains to either domestic or international destinations. Some other countries have dropped all Covid-19 restrictions and welcomed back unvaccinated travellers, including England, Ireland, Iceland and Norway. But Canada’s Chief Public Health Officer Dr. Theresa Tam says the plan to drop travel restrictions in Canada could be delayed by the emergence of new variants. "The potential for the Omicron resurgence, particularly the subtype BA.2 can still occur. So I think this is just waiting to see what happens with that situation," Tam said.
- In the United Kingdom, the government of Wales is considering extending mask and isolation rules beyond their planned expiry date of March 28. Hospitalizations and rising case numbers have caused ministers to consider the extension, although it is unclear exactly which rules would be extended, as ministers suggested that they would be picking and choosing from the legislation. Currently, masks are required in Wales on public transportation, indoor shops and in hospitals. Scotland had initially planned to scrap mask mandates on March 21, but will now keep them in place until at least April 4.
- A study out of Italy has suggested that proper ventilation systems in schools can reduce Covid-19 transmission by more than 80%. The study, published on Tuesday, compared coronavirus contagion in 10,441 classrooms in Italy’s central Marche region. The 316 classrooms with mechanical ventilation systems had significantly lower rates of Covid-19, with the reduction in cases being more pronounced based on the strength of the system. Most of Italy’s schools do not have proper ventilation systems, with teachers instead being encouraged to keep windows open. The experiment was carried out between September 2021 and January of this year and overseen by the Hume foundation think tank.
- As South Korea’s case numbers reach 10 million in total, funeral homes and crematoriums are coming under increasing pressure. On Monday the health ministry instructed 60 crematoriums across the country to burn for longer hours, raising the capacity from 1,000 cremations per day to about 1,400. But Health Ministry Official Son Young-rae says long waits and a backlog of bodies are reported in the greater Seoul area. Crematoriums will be asked to take reservations from outside of their regions – something that doesn’t typically happen – to deal with the backlog. "There have been regional differences in Covid-19 deaths because of various factors, such as the size of the elderly population in each community, and there's also a difference in the capacity of cremations each region can handle," Son said.
- In Australia, isolation rules for Covid-19 aren’t likely to change anytime soon, despite Prime Minister Scott Morrison calling them “redundant” in recent weeks. Health Officials in New South Wales and Victoria are hesitant to make any changes after receiving new modelling on caseload trajectories. As the highly transmissible Omicron BA.2 subvariant begins to take hold across the country and vaccine immunity wanes, health officials are becoming increasingly nervous at the thought of abandoning the seven-day isolation rule for household contacts. The discussion on isolation rules comes as the Australian Technical Advisory Group on Immunisation is expected to sign off on a fourth coronavirus vaccine dose for some Australians.
Covid-19 – Due Diligence And Asset Management
Investors shun money market safe haven despite February uncertainty
Brief: Amid ongoing uncertainty in Europe – from war in Ukraine to Covid – investors turned away from European mutual funds en masse in February, but ETFs managed to attract inflows, the latest data from Refinitiv shows. Bucking tradition, money market funds led the redemptions. European mutual funds lost net €67.6bn during the second month of the year, while ETFs took in €9.2bn. Overall flows for mutual funds and ETFs were negative at €58.4bn.Detlef Glow, head of EMEA research at Refinitiv Lipper, said: "It was not surprising that February 2022 was in general a negative month for the European fund industry given the geopolitical situation in Europe, the still ongoing Covid-19 pandemic, and the sluggish market environment." What did come as a surprise, however, was the fact that investors sold out of money market funds, which are usually seen as a safe haven in times of uncertainty.
Global mid-market M&A remains buoyant in Q1 2022 as entrepreneurs exit on a market high
Brief: Global mid-market M&A activity has continued robustly in the first quarter of 2022, says audit, tax and consulting network RSM, as it announces it worked on 614 completed deals in Europe last year. However, the war in Ukraine – which in addition to its dire humanitarian impact is causing inflation in the cost of raw materials and commodities – could impact deal activity and broader economic confidence in the months ahead. RSM’s advisers supported unprecedented levels of global deal activity in 2021. Among the 614 transactions completed by RSM Firms in Europe last year, the technology, media, and telecom (TMT) sector was the driving force, with 152 deals, followed by 90 completed in the engineering and manufacturing sector.
UBS to Offer 100% Remote Work Option for Eligible US-based Employees
Brief: Today, UBS announced the launch of its Virtual Worker Framework, a new industry-leading approach to flexible working that will provide US employees in eligible roles with the opportunity to work 100% remotely. UBS will begin a phased implementation of the framework over the coming months to select current and prospective employees across the country. The Virtual Worker Framework represents a natural extension and evolution of UBS’s current hybrid work model. In a global survey, 86 percent of UBS employees stated that they value greater flexibility, including the ability to maintain a remote or hybrid work arrangement. With continued technology enhancements and positive adoption of virtual work, the firm is finding new ways to engage with clients and build trusted relationships. “Hybrid working has positively reshaped the future of our workplace,” said Tom Naratil, President of UBS Americas.
What’s at Stake When the Majority of Institutional Investors Say That They’re Rethinking Their Portfolios?
Brief: Institutions aren’t just worried about the effect of inflation, the pandemic, and what they fear are outdated asset allocation rules. They’re potentially moving a vast amount of money that will create opportunities and challenges for asset managers — and move markets. Those are some of the findings from Nuveen as part of its 2022 global institutional investor study, which is expected to be published on Wednesday. Sixty-four percent of investors told the asset manager that the current market environment is pushing them to entirely rethink their portfolio construction strategies.In the survey of 800 institutions, each of which had a minimum of $500 million in assets, Nuveen found that the overhaul is being prompted by multiple head-shaking developments — including inflation rates that haven’t been seen in 40 years, the pandemic, and climate change — that are affecting the value of assets not just in the future, but today.
Partners Group's Strong Corona Rebound
Brief: After reporting strong results for 2021, the investment firm is raising its dividend in line with its assets under management growth. Zug-based Partners Groups posted a profit increase of 82 percent amounting to 1.46 billion Swiss francs ($1.60 billion) in 2021, it said in a statement Tuesday, after signaling the upward trend in January. The private equity company's assets under management (AuM) swelled to 17 percent totaling $127 billion, while performance fees increased by 46 percent of total revenues driven by «record exit activity and strong portfolio performance post COVID-19,» it said. The company will propose a dividend increase of 20 percent to 33 francs per share, in line with its AuM growth. Partners Group reconfirmed its guidance of gross client demand in the range of $22-26 billion in 2022. Its investment exposure to Russia and Ukraine was below 0.2 percent of AuM, it said.
