Retail Savings & Investments in Spain: Coronavirus (COVID-19) Sector Impact

Retail Savings & Investments in Spain: Coronavirus (COVID-19) Sector Impact

Summary

The Coronavirus (SARS-CoV-2) outbreak, dubbed COVID-19, is first and foremost a human tragedy, affecting millions of people globally. The contagious Coronavirus, which broke out at the close of 2019, has led to a medical emergency across the world, with the World Health Organization officially declaring the novel Coronavirus a pandemic on March 11, 2020.

Fears surrounding the impact of COVID-19 have already significantly impacted the global economy, with key markets across the globe losing 20-50% of their value for the year-to-date. Many economists and institutions have cut their forecasts, with consensus global GDP growth currently at 2.6% for 2020, and many experts predicting the potential onset of recessionary environments.

Spain has been severely affected by the Coronavirus, reporting the highest number of cases in Europe and standing second globally after the US, with 208,389 infections and 21,717 deaths. This massive outbreak will cause economic disruption and decelerate Spain’s GDP. The decline will have an adverse impact on all sectors, including retail investments.

This report focuses on the impact of the Coronavirus outbreak on the Spanish economy and the country’s retail savings and investment market. It also highlights the measures adopted by the government to combat COVID-19. Based on our proprietary datasets, the snap shot contrasts GlobalData’s pre-COVID-19 forecasts and revised forecasts of total retail bond, deposits, equities and mutual funds holdings in terms of value and growth rates. It also analyses the effects on HNW wealth, examining the importance of different industries as a contributor to HNW wealth.

Scope

- Spanish retail savings and investments are forecast to grow by a mere 1.5% over the course of 2020 as the economy has come to a standstill thanks to the impact of COVID-19. Retail equity and mutual fund holdings are expected to take the brunt of the economy’s slowdown, with respective declines of 22.6% and 18.4% anticipated.
- Retail deposits and holdings, on the other hand, are set to fare better than initially expected courtesy of a flight to safety away from risk assets as well as a move away from cash holdings. However, more pronounced declines in risk asset holdings result in the 2020 total retail holdings forecast standing 1.1 percentage points lower than before the onset of COVID-19.
- The effects on the different segments that make up the HNW market will be disproportionate. The financial services and investments sector, which is the largest contributor to Spanish HNW wealth, has already taken a significant hit, as indicated by the 47% decrease of the IBEX 35 Banks index since the beginning of the year.
- Falling in the defensive category, the healthcare and tech and telecommunication sectors - the second- and third-largest contributors to HNW wealth - are expected to be less severely impacted thanks to more robust demand patterns.

Reasons to Buy

- Make strategic decisions using top-level revised forecast data on the Spanish retail savings and investments industry.
- Understand the key market trends, challenges, and opportunities in the Spanish retail savings and investments industry.
- Receive a comprehensive insight into the retail liquid asset holdings in Spain, including deposits, mutual funds, equities, and bonds.