“You are the one for me, for me, formi, formidable” most of us can hum this catchy song from the singer Charles Aznavour, the “French Frank Sinatra” who died last week aged 94. During an incredible career that spanned eight decades, he wrote more than 1,000 songs, sold over 100 million records, sang in no less than 7 different languages (French, Armenian, English, German, Italian, Spanish and Yiddish) and starred in more than 60 films. Formidable legacy, isn’t it?
What was also formidable last week was the jump in bond yields as strong economic data in the US sent the yield on 10-year and 30-year Treasury bonds to seven and four year highs respectively. The sharp bond sell-off initiated in the US spread to Europe on Thursday, and Germany's 10-year bond yield rose to a four month high. Although the bond sell-off had a negative impact on equities globally, it boosted financials stocks whose profitability tends to benefit from higher long-term yields. Therefore, on Thursday, while the Stoxx 600 dropped 1.1%, the Stoxx 600 Insurance climbed 1%. Shareholders who are invested in insurance stocks may have felt like humming another tune of Charles Aznavour “Vive la vie” (“Life is beautiful”- not to forget Non-Life).
Over the week, Ageas’s share price ended down 0.5% in a downward-oriented market, but shareholders have many reasons to be in singing mood as the TSR of Ageas’s share (i.e. the total return including share price increase and dividends) for the first 9 months of the year amounted to no less than 19.3%. Ageas’s TSR strongly outperformed the market as in the same period, the TSR of the Euro Stoxx 50 and STOXX Insurance 600 stood respectively at 0% and 5.0% while the TSR of the BEL20 was minus 4.1%.