Corporate caution to the wind

This issue of Investment Insights we explore whether investors remain complacent and risk adverse despite the strong macroeconomic backdrop benefiting equity markets.

10 Feb 2018

In the fourth quarter of 2017 it was clear that many companies were watching and waiting for passage of the Tax Cuts and Jobs Act before moving forward with long-term corporate planning. Ian Read, CEO of Pfizer, put it best in his company’s second quarter earnings call last year, stating, “There are short term events in the marketplace, such as tax reform, that may change asset values. Any focus on business development is somewhat delayed by the resolution of that.” Certainly, deal activity slowed somewhat in the back half of 2017. However, with the recent passage of the tax bill, this sentiment seems to be dissipating. Greater certainty is likely to embolden corporate leadership to act more decisively, and we believe that the result will be an increased level of mergers and acquisitions (M&A) activity.


More Equities articles

Disclaimer

This website is intended for persons resident in Australia only and should not be relied upon by persons from any other jurisdiction. UBS Asset Management (Australia) Ltd ABN 31 003 146 290, AFS Licence No. 222605 is the product issuer of investment funds listed on this website. Before making an investment decision, you need to consider whether this information is appropriate to your objectives, financial situation or needs. Any potential investor should consider the relevant product disclosure statement (PDS) in deciding whether to acquire, or continue to hold units in a fund. Please consult your financial adviser. Past performance is not a reliable indicator of future performance.

Offer not to persons outside Australia

The PDS does not constitute an offer or invitation in any jurisdiction other than in Australia. Applications from outside Australia will not be accepted through the PDS. The funds are not intended to be sold to US Persons as defined under Regulation S of the US federal securities laws.

Read more about our privacy policy and UBS AM Principles of Internal Governance and Asset Stewardship

© UBS 1998 - 2020. All rights reserved