The great Spanish fortunes do not have their own voice, but they do transmit in a particular way their impressions about the progress of the economy through the forecast reports that, in a methodical manner, their collective investment companies, the SICAVs, must register before the National Securities Market Commission (CNMV). If they offered pessimistic forecasts for 2023 wrapped in threats of recession, their forecast for 2024 is very different. They now talk about improvement in business results and foreseeable drops in interest rates, without seeing big clouds beyond those brought about by the unpredictable international geostrategy.
Among the SICAVs backed by well-known fortunes in Spain are Morinvest, with the participation of Alicia Koplowitz, or Torrenova and Bellver, both from the March family. Others also stand out, such as Gesprisa, with contributions from Alberto Palatchi, former owner of Pronovias, or Allocation, from the Del Pino family, the main shareholder of Ferrovial. Another of them is Arbarin, by businessman Juan Abelló.
The impressions of big capital bear some resemblance to a recent KPMG report on business prospects for the current year. 71% of those surveyed foresee an increase in turnover throughout 2024 and 53% predict the same for investments. As a background element, there are also the recent improvements in economic forecasts from both the Bank of Spain and BBVA Research.
The Morinvest SICAV, which manages assets of 645 million euros, expects a “slight growth scenario” for this year and sees a recession unlikely. He predicts a “growth in company profits” for at least two years, with rates in Europe as a whole of 6% in 2024 and 9% in 2025. Income will increase at a lower rate, 2.5 % in 2024 and 3% in 2025.
The large sivacs of the March family, Torrenova and Bellver – the first manages 1,034 million in assets and the second 458 million – predict several interest rate cuts this year and believe that there could be “positive surprises in inflation.” If the GDP allows it, “companies will be able to continue showing growth in profits”, which, in view of their stock market returns, can translate into “more generous valuations”.
Gesprisa, which manages 1,157 million euros, also offers a good forecast for business activity. He assures that, "if 2023 has been a year from more to less in terms of level of activity, 2024 would be the opposite: it would go from less to more, that is, accelerating its growth."
The Del Pino family's SICAV, Allocation, which has assets of 537 million euros, expects interest rate cuts in the second half of the year and directs attention towards the return to fiscal rules in the EU. Starting this year, it is expected that “fiscal policies will revert to a path of lower public spending and deficit control.” “The indications from the European Commission to member countries about the need to reduce the public deficit suggest that in 2024 public spending will lose importance as a driver of the economy,” he says.
The Arbarin firm, which has Juan Abelló as a prominent participant, considers that this year, if there were no "unexpected shock", central banks should tend to lower interest rates and inject greater activity into the economy, especially in the second half of the year.
All these forecasts seem to have recovered the technical and analytical language of normal times. This was not the case in recent years, when SICAV reports were a trail of threats and concerns. A year ago, when they formulated their forecasts for 2023, they predicted a recession and problems with peripheral debt due to interest rate increases. They also pointed to the risk of second-round effects on inflation and the damage to the economy from prolonged high interest rates.
The truth is that the big fortunes ended up having an exceptional year in 2023, and proof of this are the reports recently presented by the SICAVs, in which they see an improvement in profitability. Fixed income, with rate increases, has become a safe bet, while variables, with the stock market as the main exponent, surprised last year with double-digit revaluations.
