Never before in the last two years has the world been so close to moving from pandemic to endemic as it does today. Spain, for instance, wants to treat Covid-19 as a normal illness in the future. The more countries dare to take such a step, the stronger the post-pandemic recovery in their economies should be. It was precisely for this case that Swissquote brought the Swissquote Recovery Index into being a good year ago. Its selection focuses especially on companies which were particularly affected by coronavirus measures. They come from the hospitality, tourism and even aviation sectors, for example. The index has posted a rise of around 14 per cent since it was issued, roughly in line with the market as a whole. Intervening coronavirus variants such as Delta and Omicron have prevented any outperformance so far, but the progress in vaccination appears to have eliminated the greatest danger, and a return to normality is within reach. This could in turn serve as a catalyst for outperformance in the weeks and months to come.
This can already be seen with some companies, Airbus being the primary example: while the EURO STOXX 50 plunged 6% in the last three months, the share price of the aircraft manufacturer jumped by the same amount, giving an outperformance of a cool 12 percentage points. The rally did not come about by chance, but was instead underpinned by fundamentals. Following record profits in 2021, the company can face the future with confidence. Results are set to continue climbing, and Airbus is also looking to supply 720 aircraft to its customers before the end of the year, an increase of one fifth. On the subject of new machines, arch-rival Boeing celebrated a success just recently, when the US aircraft manufacturer landed a huge order from Qatar Airways for the cargo version of its 777X passenger jet. Boeing, and its comrade-in-arms Lockheed Martin, could also profit from the new plans of the US president. According to media reports, Joe Biden is expected to ask Congress to approve a US defence budget in excess of USDbn 770 in order to modernise the military.
A comeback for the aviation industry is important for the Swissquote Recovery Index because, with a weighting of just under a third, it is the sector that sets the tone. The barometer will also profit from a recovery in the tourism industry too, however. Hotel chains such as Hilton and Marriott, cruise operators like Norwegian Cruise Line and even leisure companies such as Seaworld are responsible for more than a quarter of the price performance. At some 15%, hospitality forms the third largest group. It includes Starbucks and Yum! Brands, among others. Fast-food restaurants should, on the one hand, now be able to welcome more guests and earnings again. On the other, though, the companies are still suffering higher costs due to galloping inflation. To counteract this, some restaurant chains have already indicated that they will turn the price screw. Starbucks, for instance, had already increased menu prices in October and January and is planning further rises.
The broadly diversified Swissquote Recovery Index offers investors access to a large number of international companies which will profit from a reopening. The actively managed certificate from Leonteq tracks the price movement of the index fully, less total annual costs of 0.85%. The barometer currently has 33 companies. To ensure the selection always reflects the latest developments on the market, the index is put under the microscope quarterly. That the experts are doing a good job is clear from a glance at the price movement: quoted in USD, the product has appreciated by around 14% since its launch on 8 December 2020.
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