Live News: Elkstone private markets report; executive moves; Asian markets rise
Live News: Elkstone private markets report; executive moves; Asian markets rise
Fionn Thompson
07:21
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Irish Independent
2 days ago
- Irish Independent
Irish pensions will suffer without access to private markets, says Elkstone
Significant pension reforms in the US as well as UK initiatives to funnel funds to growth mean Ireland is now in danger of falling even further behind. Elkstone's Brian Merriman said he is relatively pessimistic of action in the coming Budget but argued long-term thinking is required – including leadership from Government – or future pension provision is going to fall significantly short in Ireland. He was commenting as the Trump administration is expected to sign an order that will allow the 401(k) pension plans used by millions of ordinary American workers access investment in private markets, including private equity, real estate, infrastructure schemes and higher return forms of lending. In Britain, Work and Pensions Secretary Liz Kendall announced this week that she is reviving a pension commission to tackle what she described as a coming 'tsunami of pensioner poverty' after her department found people due to retire from 2050 are on track to be poorer than those retiring today. Brian Merriman said there is now an expectation that returns from Irish pension savings will decline over time, if the current restrictive investing regime remains in place that in effect box most ordinary pensions savers into public investments like equities and bonds. Facilitating access to private markets would allow pension savers to benefit from higher returns, he said. Private market investments – hedge funds, private equity, venture capital investment in start-ups and private companies – have exploded in scale globally since the financial crisis of the late 2000s, while the role of traditional public assets has been in relative decline. Pension rules here have not reflected the shift, Mr Merriman said. Personal Retirement Savings Accounts (PRSA), a popular savings option, restrict investments in assets where fees may be higher or valuations are less transparent. High fees may well be justified where returns are higher, while the net return to investors should be the key consideration, Mr Merriman argues. Private capital investments are less liquid, which comes with less valuation transparency, but are suitable for long-term pension investing, he said. While high returns generally reflect higher risks, Mr Merriman said failing to open pensions to diverse investment opportunities creates its own problems. 'It is riskier not to be investing in private markets,' he said. ADVERTISEMENT A shift to facilitate Irish savers would benefit the domestic economy too, he said. 'The UK is also grappling with this question of do you force people to invest in the UK economy. In Ireland we should at a minimum have it as an opt out, so you'd have to make a decision not to put 5pc or 10pc of your investment into Irish investments.' He cited housing and infrastructure as areas where the Irish economy needs investment and where Irish savers are not active. Pointing to the push happening in the US and UK to funnel pensions into growth opportunities he said Ireland needs to be more agile and should look to get ahead rather than just catch up with other regimes. Elkstone's investments include a string of Irish tech start-ups as well as housing and student housing schemes. It advises wealthy families and individuals on their long-term investments. Opening such schemes to ordinary pensions would allow more people to access higher returns, Mr Merriman said.
Irish Independent
4 days ago
- Irish Independent
EU and US move toward trade deal that could include a 15pc baseline tariff on EU goods with possible exemptions
European negotiators were hoping to reach an agreement to dodge the 30pc tariff rate Trump has said he would impose on imports from the 27-nation bloc on August 1. The rate, which could also extend to cars, would mirror the framework agreement the U.S. has struck with Japan, which Trump announced late on Tuesday. There could be concessions for sectors like aircraft and lumber as well as some medicines and agricultural products, which would not face tariffs, the diplomats said. Washington does not, however, appear willing to lower its current 50pc tariff on steel, they said. The White House did not immediately respond to a request for comment. Trump trade adviser Peter Navarro told Bloomberg News the report from the EU should be taken with "a grain of salt." As talks continued, the European Commission said it would press on with potential counter-measures in case a deal was not reached. EU member states were set to vote on 93 billion euros of counter-tariffs on U.S. goods on Thursday, European diplomats said. A broad majority of members support using anti-coercion instruments if there is no deal, they said. Trump was aiming to secure an agreement on the heels of a complicated deal reached with Japan, the largest foreign investor in the U.S. That deal included a $550 investment and loan pledges from Japan and its commitment to buy 100 Boeing airplanes and boost purchases of U.S. agricultural products. That investment - to be spent at Trump's discretion - would focus on key industries like energy, semiconductors, critical minerals, pharmaceuticals and shipbuilding, the White House said on Wednesday. Tariffs on Japan's auto sector will drop from 27.5pc to 15pc as part of the agreement, reviving hopes for similar treatment for European cars. Asian and European stock markets rallied as investors cheered the U.S.-Japan agreement, but U.S. stocks showed a more modest rise and earnings reports were gloomy. American businesses making everything from chips to steel reported downbeat results on Wednesday, revealing how the Trump administration's chaotic trade policy has hurt profits, added to costs, upended supply chains and weighed on consumer confidence. U.S. automakers signaled their unhappiness with the Japan deal, raising concerns about a trade regime that cuts tariffs on Japanese auto imports while leaving 25pc tariffs on imports from their plants and suppliers in Canada and Mexico. "Any deal that charges a lower tariff for Japanese imports with virtually no U.S. content than the tariff imposed on North American-built vehicles with high U.S. content is a bad deal for U.S. industry and U.S. auto workers," said Matt Blunt, the president of the American Automotive Policy Council, which represents General Motors, Ford and Chrysler parent Stellantis. Automobile stocks led the climb of European shares after the Japan deal spurred hopes that the U.S. was budging over tariffs on EU cars. EU officials have previously said Washington has shown little sign of doing so. U.S. Treasury Secretary Scott Bessent said in an interview with Bloomberg Television that Japan received the 15pc rate on auto tariffs "because they were willing to provide this innovative financing mechanism" that he did not think other countries could replicate. Trump, however, has appeared open to a range of options as the U.S. negotiates trade deals. "I will only lower tariffs if a country agrees to open its market," Trump wrote in a social media post on Wednesday. The Republican president said late on Tuesday that other countries would be coming to Washington for talks this week. Governments were scrambling to close trade deals before next week's deadline that the White House has repeatedly pushed back under pressure from markets and intense lobbying by industry. U.S. and Chinese officials plan to meet in Stockholm next week to discuss extending an August 12 deadline for negotiating a trade deal. White House spokesperson Karoline Leavitt on Wednesday would not discuss expectations for the meeting, but said Bessent "looks forward to continuing discussions with his Chinese counterparts."
Irish Examiner
5 days ago
- Irish Examiner
European negotiators head for Washington after Trump agrees Japan deal
European shares climbed early on Wednesday, led by automobile stocks, after US president Donald Trump revived hopes for a trade deal with the European Union following an agreement with Japan. European automobile stocks led a broad-based rally, rising 3.6%, tracking strength in Asian rivals. Carmakers such as Mercedes-Benz, Volkswagen, and Porsche gained between 7.4% and 5.1%. Mr Trump struck a trade deal with Japan, lowering tariffs on auto imports and sparing Tokyo from punishing new levies on other goods in exchange for a $550bn (€468bn) package of US-bound investment and loans. The Japan deal included reduced 15% tariffs for auto exports to the US, down from 25% earlier. Meanwhile, the prospects of an EU-US trade agreement improved after Mr Trump said that EU representatives would come for trade negotiations on Wednesday. "The message is that things are negotiable," said RBC Brewin Dolphin's head of market analysis, Janet Lui, mentioning how Japan faced similar difficulties in reaching a tariff consensus with the U.S. "The read across is there is potential to reach a trade deal that's lifting European markets across the board." Among individual stocks, Temenos gained 18.1%, the biggest gainer in the STOXX 600, after the banking software company raised its full-year earnings forecast. UniCredit rose 3.4% after the Italian lender posted higher-than-expected quarterly profit and raised its fiscal-year outlook. Lonza rose 6.3% after the Swiss company topped core profit forecast. Conversely, Nokia slumped 7.7%, pressuring media stocks, after the Finnish group lowered its guidance for 2025 comparable operating profit on Tuesday. ASM International fell the most in the benchmark index, down 9.3%, after the computer chip equipment maker reported second-quarter bookings below market expectations. SAP fell 2.5% after the German software maker reported a positive second-quarter profit on cost cuts and increased demand. Meanwhile, the latest earnings forecasts showed on Tuesday that the outlook for European corporate health has slightly improved. On the day, Alphabet and Tesla will kick off the results season for the "Magnificent Seven" stocks. Investors will also focus on euro zone consumer confidence flash for July later in the day. Meanwhile Mr Trump said on Tuesday he would use import restrictions to force foreign suppliers to cut drug prices and that pharmaceutical companies would have a lot of problems if they did not agree to bring prices down. Speaking at the White House at an event with Republican lawmakers, Trump pledged to reduce what consumers must pay for prescription drugs.
