Survey: Geopolitical risk remains the predominant issue in global market confidence

Geopolitical risk remains the predominant issue affecting overall global market confidence, according to the Investor Relations (IR) professionals responding to a survey by investment firm BNY Mellon.

There is an overall drop in focus on the top five traditional global financial centers, as leading sources for new or increased investment in the next five years, said BNY Mellon that compared survey results in 2017 with those from 2015.

While the US continues to be perceived by most respondents as a source for investment opportunities, cited by 80% in 2017, this decreased from 91% in 2015. Over the same period, the number two-ranked United Kingdom declined to 58% from 76%, followed by China at 26%, which declined from 50% in 2015, Singapore at 26%, down from 44%, and Hong Kong at 24%, down from 37% in 2015, respectively.

In addition, respondents depend less on the sell-side for key types of investor outreach, with the majority of companies now prioritizing the ability to pick their own target investors as a defining factor for their roadshows.

“IR professionals are responding to critical market developments such as the growth of passive investment and the headwinds affecting the global brokerage community by taking on more responsibility for market engagement themselves,” said Christopher Kearns, CEO of BNY Mellon's Depositary Receipts business. “These developments stem from, among other things, regulatory reforms resulting from MiFID II, new global stewardship codes and the realities of the current market environment, which are in turn placing considerable new demands on investor relations teams globally.”