The week in investor relations: ESG flows, US-China tension and stock splits
- Sustainable investment funds continued to see strong inflows during the second quarter of the year, according to the Financial Times (paywall). Between April and June, such funds saw net inflows of $71.1 bn, said the newspaper, citing data from Morningstar.
- The world’s largest asset managers are pushing up volatility in company stocks, according to new academic research, the FT reported. Vanguard rejected the findings, saying its internal research showed no ‘causal relationship’ between volatility and an expansion of index tracking.
- New research suggests job postings can be an indicator of future company performance, reported the Wall Street Journal (paywall). ‘When companies increase the number of job postings on their websites, we anticipate an increase in sales and earnings in the future,’ said Alex Nekrasov, co-author of the study and an assistant professor of accounting at the University of Illinois.
- The WSJ noted that listings of biotech companies in the US have already passed the previous annual record. So far in 2020, US biotech IPOs have raised $9.4 bn, significantly above the previous high of $6.5 bn recorded in 2018, according to data from Dealogic.
- Major US companies have created a new initiative that will hire people from minority groups in New York, reported Reuters. The companies include JP Morgan, IBM and Accenture. Companies are under pressure to better support minority groups following the anti-racism protests sparked by the killing of George Floyd in May.
- Steven Mnuchin, the US treasury secretary, has warned Chinese companies listed in the US that they face delisting if they do not meet auditing requirements, reported Deutsche Welle. ‘As of the end of next year, if they do not fully comply, and that's Chinese companies, any other companies, because they all have to comply with the same exact accounting... they will be delisted on the exchanges,’ said Mnuchin.
- Tesla and Apple are both planning stock splits, moves that would make their shares more accessible to retail investors, reported CNN Business. Both companies have seen their shares surge since markets hit lows in March, and the stocks have risen further since the announcement of the stock splits.