Financial Friday: Summer is over, the crisis is not

August 14, 2009

The summer holidays are over but, despite encouraging earnings and positive market developments, the global economic recession is notr.  The remainder of 2009 will most likely be a slow return to normal and if some of the key indicators like joblessness and retail sales can stabilize through the fall, inverstors can look forward to a better 2010. Globally, markets will likely dip again in the beginning of the third quarter due to the the lack of information coming out of companies until October, but this is a fairly normal pattern.

Earnings reports are in from most of the US and Europe, but two of Denmarks mastadons - Mærsk and Vestas - will be releasing their earnings reports next week.  Tina Georgi, Senior Account Manager at Jyske Bank, says that the Mærsk concern may experience its first negative yearly results by the end of 2009 and that 3rd quarter results will, not unexpectedly, be dissapointing. Although the container business, in particular, continues to have trouble, the coming months will likely help Mærsk as shipping prices and activity usuallly increase in the second half of the calendar year.

Jyske Bank is one of the few who expect Vestas to surprise with its results on Tuesday. A number of smaller orders, which are not reported to investors, and a strong Chinese market will help the windmill producer both in their Q2 earnings report and through the remainder of the year.

Despite having had a bumpy ride- and most of it downhill- since 2008, Georgi sees Nokia as a positive investment for the long term.  The expanding smart phone market and Nokia's brand equity, she says, will help the Finnish concern get back on course.