Deutsche Bank chief: No stock market crash

Klaus Kaldemorgen, head of Deutsche Bank’s asset management subsidiary, said tot Handelsblatt he doesn’t believe the turbulence surrounding China at the moment will lead to a full-blown global stock market crash.

In an exclusive interview with the famous German medium Handelsblatt, Mr. Kaldemorgen of Deutsche Asset Management said: “I don’t expect a crash. One shouldn’t throw the baby out with the bath water. For a really big collapse, we would need to see a systemic risk for the global economy.”

The blue-chip DAX index has tumbled this week along with other global markets on fears that Chinese growth will sputter this year. Mr. Kaldemorgen said the Chinese authorities’ interventions in markets this week had also been “unhelpful” to market sentiment, but did not necessarily represent a threat to the entire global economy. Instead, he sees such a “systemic risk” coming from elsewhere: “One catalyst could be the falling oil price.”

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The oil price collapse – Brent crude tumbled below $35 per barrel this week – has affected oil exporters, suppliers and their investors. Mr. Kaldemorgen said he doesn’t believe oil prices have reached bottom yet. Still, the Deutsche Asset chief said he remains optimistic, and even suggested German investors should step into the market: “One can certainly consider buying at such cheap rates,” he said.

Mr. Kaldemorgen advised against bond markets that are offering low yields and even negative rates, but said there could be opportunities in the bonds of commodity producers, where prices have fallen significantly: “For maturities of up to three years, we are seeing yields in some cases of more than 10 percent,” he noted.

Read the full interview in Friday’s Handelsblatt Global Edition at 12:00 Central European Time.

www.nzg-journalisten.nl heeft een dagelijkse verbinding met het vooraanstaande medium Handelsblatt uit Düsseldorf.