Kaiser Partner Privatbank - Monthly Market Monitor EN September 2020

Monthly Market Monitor

September 2020

Table of contents Satellite View Geopolitical heat map

In a Nutshell

07

Our view on the markets

Macro Radar

04

Taking the pulse of economic activity

Theme in Focus

Asset Allocation Notes from the Investment Committee

08

The Back Page

Trump vs. Biden: It all hinges on the economy

06

10

Asset classes & agenda

ESG - Sustainability Corner Selling short with a clear conscience

12

11

Kaiser Partner Privatbank AG | Monthly Market Monitor - September 2020

3

In a Nutshell

Our view on the markets

The second wave is slowing the economic recovery Economic activity over the past weeks has continued to recover from the crash caused by the pandemic, but the initially V-shaped rebound now looks set to flatten significantly going forward. The renewed surge in COVID-19 cases in many countries in Europe and the corresponding tightening of countermeasures particularly suggest that downside risks to economic growth predominate in the second half of this year. However, all (growth) projections remain subject to a high degree of forecasting uncertainty.

It takes a magnifying glass to find inflation The topic of inflation is on every central banker’s lips these days. The US Federal Reserve has adjusted its inflation target and will now merely be aiming for an inflation “average” of 2% over time in the future. After watching US inflation regularly fall short of the magic 2% mark in recent years, the Fed now intends to purposely allow economic activity to overheat in the future. The European Central Bank is likewise contending with overly low inflation. Exceptional factors actually even dragged Eurozone inflation into negative territory in August.

“Green” bonds lift off (Overly) low inflation is a major reason why monetary policy interest rates look set to stay at historically ultralow levels in the years ahead. This is bound to also keep (government) bond yields pinned down. Despite the unattractive

Chart of the month The second wave | Contagion counts on the rise again Number of new COVID-19 cases per 100,000 people over past 14 days 250

200

150

100

50

France

Spain

Germany

Italy

08.2020

07.2020

06.2020

05.2020

04.2020

03.2020

02.2020

0

UK

Sources: European Centre for Disease Prevention and Control (ECDC), Kaiser Partner Privatbank 4

Monthly Market Monitor - September 2020 | Kaiser Partner Privatbank AG

risk/reward characteristics at present, many (institutional) investors nonetheless are forced to invest in this asset segment. “Green” bonds, though, do hold attraction, at least from a sustainability standpoint. The government of Germany joined the club of green bond issuers at the start of September. Its entrance in the green bond space looks destined to give this market segment an additional boost.

The equity market is overheated Stocks particularly in the USA knew only one direction in August: up. The S&P 500 and Nasdaq Composite have now far surpassed their previous all-time highs hit in February. Beneath the surface, however, the rally is being driven by ever fewer stocks. One-sided speculation on further rising share prices is observable on futures markets. Meanwhile, volatility has increased synchronically with stock-market advances. In the past, such synchronism has regularly presaged a stock-market correction.

More volatility in autumn Against this backdrop, we don’t see stocks staying on a one-way street in the weeks ahead. On the contrary, we foresee an elevated probability of a consolidation phase in the wake of the strong rally in recent months.

The upcoming US elections, the seething conflict between the USA and China, and the final stage of Brexit negotiations provide plenty of potential triggers at the moment for a market correction.

The dreaded second coronavirus wave that experts expected to arrive in autumn has already started to gather momentum in Europe in late summer. The number of daily new infections has surged in recent weeks particularly in Spain and France. Case counts are on the rise again in Germany and Italy as well. Governments therefore have retightened restrictions in many places and have pressed the pause button on rebooting the economy. But there is little appetite for a Lockdown 2.0. Since death counts remain low and the virus is now spreading mainly among young people, the countermeasures are likely to remain limited to social distancing, compulsory mask-wearing and local containment efforts. The economic recovery in Europe will therefore continue, albeit at a slower pace and with downside risks. Economic activity, however, is unlikely to return to the pre-crisis level before the end of 2021.

Kaiser Partner Privatbank AG | Monthly Market Monitor - September 2020

5

Macro Radar

Taking the pulse of economic activity

Inflation is a hot topic these days. The US Federal Reserve has adjusted its inflation target while the European Central Bank (EZB) is increasingly contending with negative inflation. Meanwhile, economic activity continues to gradually recover from the coronavirus shock.

Severe growth contraction also in Switzerland With a year-on-year plunge of 9.3%, the pandemic-driven growth contraction in the second quarter was staggering also in Switzerland, though it was a bit less severe than the economic crash in the Eurozone (–12.1%). Hopes are now riding on the second half of this year, which appears headed for a recovery, according to the KOF Economic Barometer and Switzerland’s manufacturing purchasing managers’ index. Switzerland’s milder second coronavirus wave thus far compared to that in neighboring countries also inspires optimism on this account.

The gradual recovery continues Economic activity continues to pick up in the rest of Europa and the USA as well. Numerous economic indicators rebounded sharply from May through July on the

Dirt-cheap? | (Overly) low inflation is a problem for central banks Inflation rates 3%

1%

0

-1%

2020

2018

2016

2014

2012

-2%

Switzerland

USA

Sources: Bloomberg, Kaiser Partner Privatbank

Consensus estimates

Kaiser Partner Privatbank interest rates view 2019

2020

2021

GDP growth (in %)

Last

3M

12M

Key interest rates (in %)

Switzerland

0.8

-5.8

4.2

Switzerland

-0.75

→

→

Eurozone

1.2

-8.1

5.7

Eurozone

-0.50

→

→

UK

1.3

-9.9

6.4

UK

0.10

→

→

US

2.3

-5.0

3.7

US

0.25

↗

↗

China

6.1

2.0

8.0

China

2.95

→

→

Inflation (in %)

10-year yields (in %)

Switzerland

0.4

-0.7

0.1

Switzerland

-0.46

→

→

Eurozone

1.2

0.4

1.0

Eurozone

-0.47

→

→

UK

1.8

0.8

1.4

UK

0.25

→

→

US

1.8

1.0

1.7

US

0.66

→

→

China

2.9

2.7

2.2

China

3.11

→

→

Sources: Bloomberg, Kaiser Partner Privatbank 6

Inflation slips into negative territory Inflation, meanwhile, is below zero not just in individual Eurozone countries, but also across the entire singlecurrency area, coming in at an aggregate –0.2% in August. The volatile price of oil isn’t the only thing putting downward pressure on consumer prices. Core inflation (which strips out energy and food) also plummeted in August. The pandemic provides an explanation here: a VAT cut has lowered prices in Germany, and other countries have seen shifts in the timing of seasonal clearance sales. Even though this probably marks nothing more than a brief excursion into deflation, the ECB is unlikely to ignore the data at its September meeting.

The Fed adopts a new inflation target Maintaining price stability has also long been a mandated objective of the US Federal Reserve’s monetary policy. The Fed heretofore defined price stability as a 2% annual increase in the consumer price index. Fed Chairman Jerome Powell recently unveiled a new inflation-targeting regime: 2% remains the target level, but now as an average across a prescribed multiyear period.

US monetary policy in the future will now place even greater emphasis on the Fed’s second mandate, maintaining maximum employment.

2%

Eurozone

heels of the abrupt nosedive, but a further recuperation now looks set to proceed more slowly going forward, with risks on the downside. Now that pent-up demand has probably been met in the meantime and the coronavirus relief for households in the United States is expiring or being scaled back, consumer demand threatens to lose strength as a driver of economic activity.

Monthly Market Monitor - September 2020 | Kaiser Partner Privatbank AG

Sources: Kaiser Partner Privatbank

Satellite View Geopolitical heat map

US presidential election race The finish line is gradually coming into sight in the race for the presidency of the world’s largest national economy. Democratic challenger Joe Biden has recently lost some of his lead. The closer the election outcome, the greater the risk of political chaos. Scenarios in which Donald Trump refuses to accept a narrow defeat or in which votes have to be recounted (multiple times) are easy to picture. A protracted impasse and attendant ongoing uncertainty would be detrimental to the financial markets and could spark price selloffs.

USA vs. China The conflict between the United States and China is simmering on a number of different burners. The trade quarrel has calmed down a bit lately, but it’s already foreseeable today that China will not be able to keep its import volume promises to the USA, so this issue

likely will soon be back on the agenda. The Americans, meanwhile, are constantly ratcheting up the pressure on Chinese companies. And the rattling of sabers continues in the South China Sea. Brexit countdown The ongoing post-Brexit negotiations between the European Union and the UK have entered the home stretch after the summer break. The unofficial deadline for reaching an agreement is by October 31, which would give national parliaments enough time to ratify a secession treaty before the UK’s official exit from the EU at year-end. But there are still many contentious points on matters such as fishery rights, dispute arbitration and state aid subsidies. We see a high risk of a no-deal outcome, but political dodges will probably be employed to “manage” a potential hard Brexit.

Geopolitical developments do not stop at the gates of the financial markets.

On the contrary, they have become an increasingly important influencing variable in recent years. Our Satellite View takes a look at the major hotspots at the moment.

Kaiser Partner Privatbank AG | Monthly Market Monitor - September 2020

7

Asset Allocation

Notes from the Investment Committee

The US equity markets posted further gains in August, driven by technology stocks. Some signals, however, now give reason to expect a turbulent autumn, so a somewhat more cautious positioning appears appropriate going forward.

While investor euphoria has reached a fever pitch for some stocks, US dollar sentiment is in the cellar, but a rebound is looking more and more likely.

Asset allocation monitor -

+

-

Cash

Equities

Fixed Income

Global

Sovereign bonds

Switzerland

Corporate bonds

Europe

Microfinance

UK

Inflation-linked bonds

US

High-yield bonds

Emerging Markets

Emerging markets bonds

Alternative assets

Insurance-linked bonds

Commodities

Convertible bonds

Gold

Duration

Real estate

Currencies

Hedge funds

US dollar

Structured products

Swiss franc

Private equity

+

Euro British pound

Equities: Tech rally continues unabated Scorecard • The technology stocks in the Nasdaq 100 index ad+ vanced significantly again in August, posting an aggre- Macro gate price gain of a good 11%. However, certain signs Monetary/fiscal policy of (near-term) overheating can no longer be denied. Earnings Apple set a new milestone with a market capitalization Valuation that has broken the USD 2 trillion barrier. Shares of Trend the company are now trading at a price-to-sales mul- Sentiment tiple of around 8x and a price-to-earnings multiple of 40x. In like manner as Apple, a stock split by electric carmaker Tesla also recently sparked a big share-price the rally. Technical market indicators and sentiment jump. After rallying by 600% since March, Tesla’s margauges suggest that further share-price advances will ket value today exceeds USD 400 billion, surpassing be erased sooner or later. Given the numerous (geo) the combined market caps of Toyota and Volkswagen, political risks and especially the upcoming US elections, the world’s two largest automakers. there are plenty of potential triggers for a market cor• Market breadth has continually narrowed further rection and a spike in volatility in the weeks ahead. lately even within the tech sector. The rally is now being driven by only a handful of stocks. Meanwhile, the Fixed income: German government bonds go “green” technology index is soaring more than 30% above its • The topic of inflation is higher up on the agenda than 200-day moving average line, which indicates that the ever at central banks. The European Central Bank rerally is now very overstretched. In addition to the still cently stressed that its Pandemic Emergency Purchase very low put/call ratios on the futures market, the VIX Program (PEPP) is tied more to the inflation outlook volatility index, also known as the “fear index”, is also than to the future development of the pandemic. The flashing a warning signal. The VIX normally falls when US Federal Reserve, under a new policy framework of the stock market rises (and vice versa), but the correinflation averaging, will be formulating its inflation tarlation has recently risen into positive territory. In past get more flexibly in the future, aiming for an inflation observations, this phenomenon has always preceded rate above 2% in the years ahead to offset the low inflaa correction on the stock market. tion registered over the past several years. The combina• “The trend is your friend”, but robust momentum is tion of falling (market-based) inflation expectations and currently the only force supporting a continuation of relatively rigid nominal interest rates has real interest 8

Monthly Market Monitor - September 2020 | Kaiser Partner Privatbank AG

tion cuts somewhat and is now pumping a bit more rates currently stuck at very low levels. (Nominal) bonds oil again. In spite of this headwind, oil looks set to remain unattractive investments against this backdrop. continue climbing in the medium term toward an • Despite the meager and in some cases guaranteed negequilibrium price above USD 50 per barrel. ative interest yields, many (institutional) investors have to invest in (government) bonds whether they want to or not. And here the motto for more and more inves- Currencies: US dollar in the cellar tors is: “If you have to buy bonds, opt for green ones.” • EUR/USD: The EUR/USD exchange rate’s upward momentum slowed a bit in August. The USD 1.20 mark reGermany placed its first-ever green government bond mains a tough nut to crack, and the exchange rate may issue on the market in early September, and it sold like have a hard time breaching that level on its first attempt. hotcakes. The government of Germany soon plans to A (verbal) headwind against the euro was recently stirred issue additional green bonds with maturities ranging up by several members of the ECB’s governing council, between two and 30 years to establish a “green yield who said they viewed the currency not as a target varicurve”. As the most important bond issuer in Europe, able, but as an important input factor for setting moneserving as the risk-free benchmark for many investors, tary policy. Since inflation has been disappointingly weak Germany’s green engagement sends a key signal. It is lately, the strong euro and its disinflationary effects come bound to further raise the acceptance of the already at a more than inopportune time for the European Cenrapidly growing “sustainable fixed income” asset class. tral Bank. We see more downside than upside risk for the euro at the current exchange-rate level.

Alternative assets: Gold in new waters • After embarking on a maiden excursion above the • GBP/USD: The British pound likewise has chart resistance to contend with. The key resistance level is situUSD 2,000-per-ounce mark, the price of gold took a ated at the 1.35 mark against the greenback, which needed breather in August. But the retest of the prealready abruptly halted sterling’s rise last year. Meanvious all-time high hit back in 2011 should be viewed while, time pressure is mounting in the UK governas a healthy correction within an intact uptrend chanment’s post-Brexit negotiations with the EU. An agreenel and is likely to lay the foundation for further price ment has to be reached by the end of October in order advances because the positive fundamentals for the to ratify a deal by year-end. The risk of delays or a (poyellow metal – low real interest rates, copious centrallitical) mishap is inadequately priced into the exchange bank liquidity and persistent investor demand – don’t rate, which increases its vulnerability to a correction. appear poised to change much anytime soon. The price of silver also looks set to rise in gold’s slipstream. • EUR/CHF: The EUR/CHF exchange rate barely budged in August. However, viewed from a distance, the euro • Oil prices have shown relatively little movement appears to be in a progressive uptrend since May. In in recent weeks. Over the summer, the price of addition to the positive political signals seen in recent Brent crude oil climbed slowly but steadily to USD weeks, it will also take a tangible improvement in eco46 per barrel at last look. After rebounding sharply nomic growth prospects to give the euro a further lift. in May and June, the recovery in oil demand from In any case, the stabilization of the EUR/CHF exchange the depths of the pit caused by the pandemic has rate is bound to put smiles on faces at the Swiss Nanoticeably stalled lately. The rebalancing of the oil tional Bank because it renders currency interventions market is also being delayed by the supply side now unnecessary at the moment. that the OPEC+ alliance has dialed back its produc-

Chart in the Spotlight Has a floor been found? | Long-term interest rates in rangebound trend Yield on 10-year US Treasury notes 4%

3%

2%

1%

Sources: Bloomberg, Kaiser Partner Privatbank

2020

2019

2018

0

The yield on 10-year US Treasury notes intermittently dipped below 0.5% during the summer. The US Federal Reserve’s securities purchases thus produced their intended effect since interest-rate volatility, as measured by the MOVE index, is also in the cellar. But movement on the interest-rate market has now picked up a bit recently.

At the virtual Jackson Hole symposium, Fed Chairman Jerome Powell quashed expectations that the Fed would start managing the yield curve. The innovation presented instead – merely targeting an inflation average of 2% over time in the future – is stirring inflation speculation and giving market interest rates at the long end of the curve more leeway. From a contrarian perspective, the large net speculative long position on the futures market is also an argument pointing to a mild increase in interest rates, especially if the US economy regains its footing. However, we see the current yield rally fizzling out at a level just below 1%.

Kaiser Partner Privatbank AG | Monthly Market Monitor - September 2020

9

Theme in Focus

Trump vs. Biden: It all hinges on the economy

It’s the economy, stupid! common ground in one area: their shared intention to The US presidential election race enters the final sprint further cut taxes. in the weeks ahead. Various opinion surveys and online betting markets show Democrat Joe Biden still leading …or higher taxes under Joe Biden?

President Donald Trump at the moment, but Trump has Joe Biden, in contrast, is running on pledges to raise regained some ground in recent weeks. According to a taxes. His stated plan is to increase the top marginal closely watched National Public Radio poll, the economy personal income tax rate from 37% to almost 40% and is the most important election issue to voters ahead of to lift the tax rate on corporate earnings from 21% to the pandemic, and despite a double-digit unemployment 28% in order to generate around USD 3 trillion of exrate and a record-high federal deficit, Trump continues to tra tax revenue over the next decade. Biden, however, rate higher than Biden on the question of which candi- backs away from an explicit wealth tax, thus distancing date would handle the economy more skillfully. himself from his politically more radical contestants in the primaries. Biden’s agenda is also more moderate on America soon even greater under Trump… the issue of healthcare (expanded coverage yes, but no The sitting president’s election campaign platform con- “Medicare for all”) and with regard to the technology sists mainly of classic Trumpian standbys – a break with goliaths from Silicon Valley. Although Biden, too, holds China, promotion of “Made in America” and a restric- a critical view on their market power, he doesn’t advotive immigration policy – and little else new. Trump cate breaking them up. This last point in particular isn’t wants to bring a million manufacturing jobs back to the trivial for investors and shareholders considering that USA from China, and tax incentives beckon for compa- the equity bull market over last eleven years was led by nies that manufacture “at home”. Whoever outsources these very same tech giants. In the area of trade policy, to China, in contrast, would no longer receive govern- the Democrat doesn’t differ notably from Trump along ment contracts. Moreover, all critical equipment items fundamental lines. He, too, endorses a “Buy American” are to be manufactured domestically. These election policy. Biden presumably would be more conciliatory promises mark a seamless continuation of Trump’s pro- toward China, but the “cold war” with the great Asian tectionist agenda over the last four years just as much power would nonetheless likely continue. as they constitute a continued break with the Republicans’ longstanding firm party line in favor of interna- One thing for certain: More debt tional free trade. But the president and his party do find Be it Biden or Trump, whoever takes the reins of government in Washington D.C. at the end of January 2021 will face an enormous budget deficit, a gigantic government Limitless | The USA’s mountain of debt will continue to grow debt load and an economy in rehab. The CongressioUS federal debt projection nal Budget Office (CBO) projects a federal budget deficit of USD 3.7 trillion for 2020, which doesn’t factor in 110% the next coronavirus relief package that Congress is still negotiating.

COVID-19 now looks set to catapult the US 105% federal debt load to over 100% of the country’s annual 100% gross domestic product (GDP) by the end of this year.

95% Back in March, this mountain of debt wasn’t projected to materialize until after 2030. This debt trend obviously 90% isn’t a healthy development. The US dollar remains the 85% undisputed world reserve currency (for which there is currently no alternative), but its status could start to tot80% ter if US finances get further out of control.

The US presidential election battle is entering the final round(s). For voters and investors, the most important plank in both candidates’ campaign platforms is their economic policy agendas.

The differences, however, in the economic duel between Trump and Biden lie within fairly narrow bounds, aside from on the issue of taxes.

What’s limitless, in contrast, is the outlook for US government debt.

75% 2019

2020

2021

2022

2023

2024

Estimation March 2020

2025

2026

2027

Update April 2020

Quellen: CBO, Kaiser Partner Privatbank

10

Monthly Market Monitor - September 2020 | Kaiser Partner Privatbank AG

2028

2029

2030

ESG- Sustainability Corner Selling short with a clear conscience

ESG among conventional investors…

Taking environmental, social and corporate governance (ESG) aspects into account in the management of client assets has become more of a duty than a voluntary choice for institutional investors, especially for the majority of them that manage portfolios of stocks and bonds the traditional way by going exclusively longonly to achieve (long-term) asset appreciation. These conventional investors have different ways to factor ESG aspects into their investments. The oldest way is to simply exclude securities issued by companies or countries that contravene traditional moral values (by producing products or services involving alcohol, gambling or weapons, for example) or violate standards and norms (e.g. human rights and environmental protection). Other ways are to take the best-in-class approach that favors the “most sustainable” companies, to invest thematically, to take the often more complex route of incorporating ESG criteria into the analysis and selection of securities, or to engage in impact investing. …and among hedge funds The sustainability theme is still a growth area, in contrast, for institutional investors that pursue alternative investment strategies (hedge funds). In a 2016 survey of signatories to the Principles for Responsible Investment sustainability initiative, less than half of the respondents endorsed incorporating ESG aspects into alternative investment strategies. This may be due in part to the fact that the “hedge fund” investment category is composed of a hodgepodge of substrategies, which makes it harder to introduce ESG norms. Moreover, some subcategories like trend-following strategies, for example, cannot be implemented in alignment with sustainability norms for technical or conceptual reasons. However, the hedge fund sector is precisely one area where investing in line with ESG criteria is actually quite interesting because, unlike conventional institutional investors, hedge funds are less heavily regulated and have greater latitude in choosing and implementing their investment strategies. Hedge funds, for instance, can use borrowed capital to leverage investments and can employ derivatives or short-sell securities. “Selling short” means borrowing stocks and then selling them on the market in the expectation of buying them back later at a lower price, thus earning a profit.

Example: CO2 footprint The PRI initiative recently acknowledged the usefulness of short selling in sustainable investment strategies. One practical example of short selling (with a clear conscience) concerns CO2 footprints. CO2 emissions are easy to measure and compare. A company’s environmental footprint has since become an important ESG criterion. Companies (and stocks) with a high CO2 intensity pose a risk to our environment as well as for investment portfolios, for instance if a CO2 tax gets introduced. An alternative investment manager can hedge this risk by using short sales to build a short position alongside existing long positions in order to reduce a portfolio’s net CO2 footprint. Moreover, the alternative manager can also profit directly from the CO2 risk by building a short-only position in expectation that the asset will lose value going forward. While short-selling can be used at the micro level for hedging or to earn profits, its usefulness from a sustainability standpoint is even greater at the macro level. Because if a large enough number of market participants pursue this approach, that could cause a significant increase in the cost of equity for the companies targeted. That, in turn, could prompt the managers of those companies to rethink their business models and make them less CO2-intensive. A utility company with a lot of coal-fired power plants would accelerate its transition to alternative energy sources, for example.

Investing sustainably has become a widespread practice among conventional institutional investors. Hedge funds, in contrast, still have some catching up to do in implementing this forward-thinking investment approach. Compared to long-only investors, though, hedge funds have more ways at their disposal to exert influence on sustainability – by selling short, for example.

Kaiser Partner Privatbank AG | Monthly Market Monitor - September 2020

11

The Back Page Asset classes & agenda

Performance as of 31 August 2020 Asset class

year-to-date

Cash

1 month

1 year

3 years

0

Cash CHF

-0.4%

-0.1%

-0.7%

-2.1%

Cash EUR

-0.3%

0.0%

-0.4%

-1.1%

0.0%

1.2%

5.9% 10.0%

Cash USD

0.6%

Fixed Income

0

Sovereign bonds

4.1%

Corporate bonds

6.7%

Microfinance

0.9%

Inflation-linked bonds

7.5%

High-yield bonds

0.1%

Emerging markets bonds

1.7%

Insurance-linked bonds

4.1% 19.4%

Convertible bonds Equities

4.0% -2.6%

Switzerland -10.6%

Europe -20.3%

11.0%

USA -1.2%

Emerging markets -9.4%

29.7%

Gold Real estate Switerzland

-1.2% 1.8%

Hedge funds

6.4% -0.6%

CHF/USD

0.9%

GBP/USD

16.1%

0.2%

2.2%

10.3%

-0.9%

3.9%

17.7%

0.7%

3.2%

14.1%

0.4%

3.2%

13.2%

1.1%

7.0%

8.8%

6.6%

26.6%

38.4%

6.3%

14.4%

32.2%

1.5%

3.2%

22.5%

3.5%

-2.5%

1.7%

1.5%

-16.1%

-12.0%

7.5%

23.1%

49.7%

2.1%

11.9%

1.3%

6.8%

-4.8%

-13.4%

-0.4%

29.4%

48.9%

-1.3%

4.7%

13.5%

1.5%

4.9%

5.3%

0

Currencies EUR/USD

7.7%

0

Alternative assets Commodities

1.8%

0

Global

UK

-1.0% -0.3%

1.3%

8.7%

0.2%

0.3%

-0.9%

-5.5%

2.2%

10.0%

3.4%

On our Agenda September 15 to 17: World Sustainability Forum The 8th World Sustainability Forum will take place virtually from Basel. To mark the 5th anniversary of the 2030 Agenda for Sustainable Development and the UN Sustainable Development Goals (SDGs), the forum will take stock of humanity’s progress toward a more sustainable world.

September 27: World Tourism Day The number of international tourist arrivals has increased from 25 million in 1950 to 1.5 billion today.

Global tourism today accounts for 10% of the world’s economic output and 10% of all jobs worldwide.

World Tourism Day fosters awareness of the importance of tourism, especially in the age of COVID-19.

October 2: US employment market data The US Labor Department’s monthly job market report triggers significant share-price movements on the Stock Exchange. After stagnating at 10.2% unemployment rate in August, the question now is whether the US job market picked up further, which also has a bearing on the upcoming presidential election.

12

Monthly Market Monitor - September 2020 | Kaiser Partner Privatbank AG

Kaiser Partner Privatbank AG | Monthly Market Monitor - September 2020

13

This document constitutes neither a financial analysis nor an advertisement. It is intended solely for informational purposes. None of the information contained herein constitutes a solicitation or recommendation by Kaiser Partner Privatbank AG to purchase or sell a financial instrument or to take any other actions regarding any financial instruments. Furthermore, the information contained herein does not constitute investment advice. Any references in this document to past performance are no guarantee of a positive future performance. Kaiser Partner Privatbank AG assumes no liability for the completeness, correctness or currentness of the information contained herein or for any losses or damages arising from any actions taken on the basis of the information in this document. All contents of this document are protected by intellectual property law, particularly by copyright law. The reprinting or reproduction of all or any parts of this document in any way or form for public or commercial purposes is expressly prohibited unless prior written consent has been explicitly granted by Kaiser Partner Privatbank AG. 14

Monthly Market Monitor - September 2020 | Kaiser Partner Privatbank AG

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