Calvert Research

Feb 15, 2023

Morgan Stanley Doubles Down on ESG Despite the Politics US Regulatory Curbs Spark $900 Million Slump in Binance-Branded Stablecoin BUSD Emirates, Qatar Airways and Etihad in Garuda Partnership Talks Turkey Arrests 20 Over ‘Provocative’ Social Media Posts on Earthquake Ghana Inflation Unexpectedly Slows for First Time in 20 Months Zambia Central Bank Raises Key Rate by 25 Basis Points Anta Slumps as Entry of Stake in Clearing System Fuels Sale Talk Turkey Stocks Surge as State Support Underwrites Reopening Boost UK Gilts Rally as Inflation Slowdown Prompts Paring of BOE Rate Wagers China Reopening Impact May be Next Catalyst For Higher US Yields Two Lawyers Have $3 Billion and Careers at Stake in a UK Trial Nigerian Court Adjourns Hearing on Use of Old Naira Banknotes Polish Inflation Speeds Up as Warsaw’s Forecast Clashes With EU Asia Stocks Set for Choppy Open on CPI, Fed Speak: Markets Wrap Namibia’s Moderate Hike Leaves Key Rate at Six-Year High Anchorage Liquidates CLO Warehouses From BirchLane Takeover China’s Oil Buying Spree a Boost for Global Demand Outlook Amplats’ First Female CEO to Leave for World’s No. 1 Gold Miner Wave of Tunisian Arrests Escalates Crackdown as Economy Founders Food Prices Hit 14-Year High as South Africa Power Cuts Escalate 75% of Canadians say any level of debt is a relationship deal breaker: Survey Filing taxes for the first time? Here's what you need to know ​Nearly half of all insolvencies last year were filed by millennials: Study Panic and confusion grip RRSP season, once again: Dale Jackson Food inflation dips into Super Bowl spreads One-third of households say they're financially worse off compared to year ago: poll What to know about investing with your student line of credit Is your income 55K or less? Consider using a TFSA over RRSP: Advisor Credit cards with travel rewards provide 'bang for your buck': Personal finance Contributing to an RRSP is sometimes a bad idea Started a side hustle? Seek expert advice to avoid tax season headaches It's possible to have 'too much' in your RRSP: Tax expert How couples can team up on debt repayment Rate hike pause puts retirement investors in a sweet spot Experts explain how to cope with money stress REITs provide safer alternative for wannabe landlords: Dale Jackson 6 TFSA myths that could dampen tax savings How pay transparency may affect your job search or raise 50 guests or less: Couples opt for micro-weddings amid inflation China Must Fix Business Confidence Post-Covid Zero: EU Chamber Indonesia’s Banks Were Big Lenders to Indebted Builder Waskita Singapore Home Sales Reach Four-Month High as Supply Picks Up Here Are the Winners and Losers From Singapore’s Budget Commonwealth Bank Profit Meets Estimates as Rates Climb China’s Coal Emissions Are a Mystery in Fog of Conflicting Data Singapore to Increase Taxes on Higher Value Properties Magnolia, Founded by ‘Fixer Upper’ Stars Chip and Joanna Gaines, Explores Stake Sale Trump’s $110,000 Contempt Fine Upheld by New York Appeals Court Brookfield Defaults on Two Los Angeles Office Towers Inflation Digs In to Start 2023, Pointing to Longer Fed Fight Guy Hands Halted £8 Billion Homes Sale as UK Fretted Over Profit Thailand to Impose 300 Baht Entry Fee for Foreign Travelers From June as Tourism Booms How London’s Chinatown Stopped Tenants ‘Throwing in the Towel’ Tokyo Condo Market Shows Early Cooling Signs on BOJ Policy Risks Asian Issuers Seen Turning to Convertible Bonds for Cheap Funding China’s Wind and Solar Are Now Almost Enough to Power Every Home Hong Kong’s Lee Defends Adding Security Clause to Land Auctions China’s Economic Bonanza From Record Trade Surplus Is Fading Lufthansa Says IT System Issues Causing Widespread Cancellations China’s Xi Urged Stronger Measures to Boost Domestic Demand Morgan Stanley Doubles Down on ESG Despite the Politics West Fraser Timber reports loss in Q4 as interest rates weigh on U.S. construction US Regulatory Curbs Spark $900 Million Slump in Binance-Branded Stablecoin BUSD EU Sanctions Seek to Make Banks Divulge Frozen Russian Assets The Best Accessory for a Boat Is a Karaoke Machine Emirates, Qatar Airways and Etihad in Garuda Partnership Talks Suncor's fourth-quarter profits increase 76 per cent to $2.74 billion Billionaire Deripaska Challenges Scope of EU Sanctions on Russia Turkey Arrests 20 Over ‘Provocative’ Social Media Posts on Earthquake Scotland’s Sturgeon to Resign as First Minister, BBC Reports Babcock Wins £400 Million UK Military Skynet Satellite Contract Anta Slumps as Entry of Stake in Clearing System Fuels Sale Talk Turkey Stocks Surge as State Support Underwrites Reopening Boost Barclays Profit Drops 8% to £1.3 Billion as Fixed Income Traders Fall Short ASML Says Ex-Employee in China Misappropriated Chip Data China Reopening Impact May be Next Catalyst For Higher US Yields Airbnb's sales forecast tops estimates on strong travel demand Oil climbs from one-month low on dual supply outages Morgan Stanley Doubles Down on ESG Despite the Politics EU Sanctions Seek to Make Banks Divulge Frozen Russian Assets Zambia Central Bank Raises Key Rate by 25 Basis Points Turkey Stocks Surge as State Support Underwrites Reopening Boost China Reopening Impact May be Next Catalyst For Higher US Yields Two Lawyers Have $3 Billion and Careers at Stake in a UK Trial Asia Stocks Set for Choppy Open on CPI, Fed Speak: Markets Wrap Barclays Docked Bonus Pool By £500 Million Over Control Issues China’s Oil Buying Spree a Boost for Global Demand Outlook Amplats’ First Female CEO to Leave for World’s No. 1 Gold Miner Food Prices Hit 14-Year High as South Africa Power Cuts Escalate To Go Climate-Positive, Ikea Needs to Fix Its Furniture Glue Trafigura Nickel Fraud Would Not Happen at Glencore, CEO Says IEA Boosts Global Oil Demand Forecast as China’s Economy Reopens Lynas Loses Bid to Keep Unit of Malaysia Rare Earths Plant Open How to Power a Plane With Leftover Chinese Hot Pot Russia’s Dark Tanker Fleet Gets Stretched Sailing Thousands of Miles: Oil Strategy Glencore to Pay Out $7.1 Billion After Coal Drives Record Profit U.S. officials float even higher rates after brisk inflation data MPs summon big grocery store CEOs to testify in Ottawa over food inflation U.S. Fed officials float even higher rates after brisk inflation data The Daily Chase: Tim Hortons parent company announces new CEO; TC Energy hikes dividends Higher interest rates pinch consumers, bolstering Bank of Canada pause ​Nearly half of all insolvencies last year were filed by millennials: Study The Daily Chase: Millennials grapple with insolvencies; Markets point to flat open TSX recap: Index finishes slightly higher amid gains in energy stocks Unlikely that central banks will cut rates this year: Mark Carney Bank of Canada seeks 'new thinking' with outsider at rate table WATCH: Exclusive interview with former BoC governor Mark Carney Canada crushes expectations, adding 150,000 jobs in January The Daily Chase: Canada adds 150,000 jobs in January; Magna misses Q4 estimates The Daily Chase: Canopy Growth to cut 800 jobs; Bombardier forecasts increased jet demand Report urges windfall tax to recover CEWS funds from large corporations BoC considered not raising rates last month, but hot economy swayed decision TSX recap: Index finishes lower amid losses in tech, utilities Five key takeaways from the BoC's first summary of interest rate deliberations Auto prices to ease but affordability still a challenge with no quick fix: experts EU Sanctions Seek to Make Banks Divulge Frozen Russian Assets Turkey Arrests 20 Over ‘Provocative’ Social Media Posts on Earthquake Scotland’s Sturgeon to Resign as First Minister, BBC Reports Babcock Wins £400 Million UK Military Skynet Satellite Contract Ghana Inflation Unexpectedly Slows for First Time in 20 Months Zambia Central Bank Raises Key Rate by 25 Basis Points ASML Says Ex-Employee in China Misappropriated Chip Data Lula Leaves Decision on Brazil’s Inflation Target for Later DeSantis Wants to Be the GOP’s Most Gun-Friendly Candidate. It Could Cost Him in 2024 Wave of Tunisian Arrests Escalates Crackdown as Economy Founders Jordan Sends First Top Envoy to Syria Since 2011 to Discuss Aid Tax Probe at BBC India Offices Continues in Wake of Modi Film Hong Kong to Force Broadcasters to Run Patriotic Content on Air UK, US Broke Human-Rights Laws With Island Evictions, HRW Says BRICS Debates Expansion as Iran, Saudi Arabia Seek Entry Central Bankers in Bunkers Keep Ukraine’s War Economy Afloat India Tax Officials Visit BBC Delhi Office Weeks After Modi Film China Investigates Official Who Once Met Xi to Talk Soccer Australia State Promises New Laws to Prevent Drilling Off Sydney Lufthansa Says IT System Issues Causing Widespread Cancellations US Regulatory Curbs Spark $900 Million Slump in Binance-Branded Stablecoin BUSD EU Sanctions Seek to Make Banks Divulge Frozen Russian Assets Turkey Arrests 20 Over ‘Provocative’ Social Media Posts on Earthquake Babcock Wins £400 Million UK Military Skynet Satellite Contract ASML Says Ex-Employee in China Misappropriated Chip Data Nomura’s Crypto Arm Invests in DeFi Lending Protocol Infinity To Go Climate-Positive, Ikea Needs to Fix Its Furniture Glue Taiwan’s Chip Exports to China Post Largest Drop in 14 Years How to Power a Plane With Leftover Chinese Hot Pot Dalio Says China’s Winning Trade War With US But Clash Avoidable Mom-and-Pop Investors Keep Faith in India Despite Adani Rout Musk Aiming to Find Successor as Twitter CEO Toward End-2023 Quake Latest: 40,000 Killed; Turkey Stock Market Set to Reopen Chinese Protests Over Health Insurance Underscore Risks for Xi Hong Kong to Force Broadcasters to Run Patriotic Content on Air Indonesia’s Indosat Nearing Towers Deal With Mitratel, Sources Say Bitcoin Trades Back Up to $22,000 as Regulatory Concerns Ease New Zealand in Rescue Mode After Cyclone Gabrielle Displaces Thousands The U.S. Fed is failing in four ways: Mohamed A. El-Erian Apple, JPMorgan turn to pay now grow later Remote Working Boom Is Huge for College Towns Like Knoxville Walmart flashes a warning sign to the entire consumer economy: Andrea Felsted Millennials are finally spending like grown-ups Dismal U.S. GDP report raises the odds of recession this year: Gary Shilling Musk is wrong for Twitter even if deal math works out Chocolate bunnies can teach us to save our food supply The Fed has made a U.S. recession inevitable America's oil reserve weapon risks misfiring Four-day workweeks can burn you out U.S. Fed expects a soft landing. Don't count on it Markets are pushing Fed into developing-economy territory Commodity traders go from bonanza to bailout plea Putin's war shows West must clean up dirty money Salary transparency is good for everyone Microsoft's US$69B Activision deal could be a blunder What if the oil market bulls are wrong and this lonely bear is right? Canada's trucker protest may spread from Ottawa to U.S. Turkey Stocks Surge as State Support Underwrites Reopening Boost Vanguard to Liquidate a Mutual Fund for First Time Since 2020 Turkey Plans Tax Waiver for Share Buybacks on Stock Exchange After Trading Halt George Soros Loaded Up on Corporate Bonds Ahead of 2023 Rally Biotech Went Through Its IPO Boom. Now the Shakeout Is Underway Wall Street’s Mutual Fund-to-ETF Magic Trick Is Failing to Wow World’s Riskiest EM Bonds in Play as Distressed Makes a Comeback ETFs Used for Nearly $3 Billion of Insider Trading, Study Shows It’s Too Soon for Stock Investors to Call Victory on Inflation How State Street Has Used AI to Find ‘Hidden Gems’ Since 2018 Gas ETF Gains $518 Million in Flows Despite Price at Record Low How Wall Street Is Using Artificial Intelligence to Build ETFs Crypto Gives Way to Vanguard as ETFs Get ‘Back to Basics’ Vanguard’s One-of-a-Kind Fund Design Is About to Get Some Competition Turkey Risks Inflation Surge, Budget Breach as Quake Costs Mount MSCI Reviews ‘Free Float’ of Adani Stocks Amid Investor Concerns Turkey Suspends Trading in Stock Market After Rout Deepens Quant Funds Shed Billions as Wall Street’s Hottest Trends Falter MicroStrategy Eyes Bitcoin Futures as Part of Crypto Strategy, Saylor Says Restaurant Brands' CEO change is 'all about accelerating growth': Executive chairman Reed Hastings explains why he's stepping down as Netflix CEO in blog post Bankman-Fried says in court that he's ready for U.S. extradition SBF sent back to Bahamian jail after catching lawyer off guard with U.S. extradition plan Disney's Iger returns to reckon with his own 15-year Legacy Women making small gains, but still troublingly under-represented in the C-suite Gerry Schwartz to step down as CEO at Onex, Bobby Le Blanc named next CEO Dominic Barton on Canada-China relations, future at Rio Tinto 'We’re serving Canadians better' following the pandemic: McKesson Canada CEO Rebecca McKillican World's richest family loses US$11.4B in Walmart rout 'Fine balance': Rania Llewellyn on fitting her long-term inclusion goals into Laurentian's revamp First female bank CEO in Canada leads with younger self in mind ​Company holiday parties are making a comeback, but many employers have a plan B Elon Musk and Jeff Bezos now worth almost half a trillion dollars Jane Fraser has a plan to remake Citigroup while tormenting rivals ‘Forever changed’: CEOs are dooming business travel — maybe for good National Bank names Laurent Ferreira CEO, succeeding Vachon The remote-work czar is the new shortcut to the C-Suite Olympics boss aims to put 'most-followed' Tokyo games on track Tim Quinson, Bloomberg News (Bloomberg) -- Morgan Stanley has picked an interesting moment to press ahead with expanding its offering of ESG-themed funds. Earlier this month, the New York-based investment bank introduced six ESG products. The equity and fixed-income exchange-traded funds are managed by Calvert Research and Management, a leader in environmental, social and governance investing that Morgan Stanley acquired in 2021 as part of its purchase of Eaton Vance Corp. Morgan Stanley’s decision is particularly notable given the increasing pushback against ESG by Republican politicians, including some potential presidential aspirants, and their fossil-fuel industry donors. John Streur, Calvert’s chairman, accepts that the political environment is fraught. But he said “we’re feeling pretty good” about demand for the new products. The firm had net fund inflows last year, even as stock and bond markets recorded their worst year since the financial crisis of 2008. “ESG is all we do and we believe we have a better investment strategy than anyone else in the marketplace,” Streur said. And ESG isn’t going away, Streur said. In fact, more companies are focused on reducing their exposure to financially material environmental, workplace and corporate governance risks than ever before, he explained. “It’s not the greatest timing for ESG,” said Eric Balchunas, an ETF analyst at Bloomberg Intelligence. “Flows have flat-lined with energy prices up and the anti-ESG backlash gaining momentum.” But trying to time the market is futile, said Anthony Rochte, Morgan Stanley’s global head of ETFs. Decisions like these are made looking five to 10 years down the line, he explained. Rochte said the launch of the Calvert ETFs will be followed by offerings from some of Morgan Stanley’s other non-ESG investment brands, including Eaton Vance. Read More: Morgan Stanley Makes an ETF Comeback With New Funds Morgan Stanley has allocated $20 million of seed capital to each of the six Calvert funds, and there’s also a group of outside investors that backed the launch, Rochte said. He declined to identify them. To put Morgan Stanley’s investment in perspective, ESG-labeled ETFs in the US attracted a net $2.9 billion in total last year, down from a record $36 billion in 2021, data compiled by Bloomberg show. Balchunas contends the Calvert funds may struggle to win investors in the short term, even with all of Morgan Stanley’s marketing muscle behind them. “It’s a tough environment,” he said. Nevertheless, Balchunas added that Calvert has been “the least worst in terms” of investment flows among all of Morgan Stanley’s brands during the past year, and that ESG metrics are here to stay despite the issue’s politicization from the right. The new products are the Calvert International Responsible Index ETF (ticker CVIE), the Calvert US Large-Cap Core Responsible Index ETF (CVLC), the Calvert US Large-Cap Diversity, Equity and Inclusion Index ETF (CDEI), the Calvert US Mid-Cap Core Responsible Index ETF (CVMC), the Calvert US Select Equity ETF (CVSE), and the Calvert Ultra-Short Investment Grade ETF (CVSB). The way in which Morgan Stanley is pricing these funds gives them a better chance of succeeding, Balchunas said. The passive products—CVIE, CVLC, CDEI and CVMC—carry expense ratios of 20 basis points or cheaper, while its active ETFs—CVSE and CVSB—will charge below 30 basis points. “These funds are legitimately low-cost,” he said. “They’ll likely attract some assets over time.” ©2023 Bloomberg L.P.