Developed Countries

Canadian Inflation: Slowing, But Not Enough To Calm The BoC

Canadian inflation slowed in May, slowing to 3.4% on a year-over-year basis from 4.4% in April. This matched market expectations, with the monthly increase of 0.4% (versus 0.7% in April), slightly lower than the 0.5% consensus forecast. The year-over-year…

3 years ago

Essentials

European Aerospace And Defense Stocks Are Hot

European aerospace and defense stocks are on the offense. Year-to-date, they are up 20% in absolute terms and 24% relative to their US counterparts, both in US dollar terms. The relative 12-month forward earnings suggest that this outperformance still has…

3 years ago

FICC

Credit Cycle Checkup

Special Report

This week’s Special Report updates our US default rate forecast and considers whether corporate bond spreads offer value given the trend in credit fundamentals. We also consider the relative value proposition between investment grade and high-yield credit and between European and US corporate bonds.

3 years ago

Equities

Hit, Miss, Moving Forward

Momentum, high cash balances, FOMO, and expectations of soft landing drive the market higher. This rally may continue for a while, but macroeconomic headwinds are intensifying and will eventually derail the rally. It is too early to celebrate victory.

3 years ago

CoreMacro

So Much For Détente?

Special Report

Talks of a détente are premature and there is no domestic political basis in China or the US to support a true détente. Investors should not underappreciate global risk, on the basis of a détente, and should avoid Greater China equities in the next 18 months.

3 years ago

Essentials

Recession Delayed, But Not Denied

The Conference Board’s US Leading Economic Indicator continues to warn about the economic outlook. The month-on-month rate of change and the six-month rate of change showed the index declining at a faster pace. Weaker consumer expectations for business…

3 years ago

Essentials

The BoE Returns To Outsized Rate Hikes

The Bank of England surprised markets with a larger-than-anticipated 50bps rate hike on Thursday, raising its policy rate to 5% versus expectations of 4.75%. Seven of the nine MPC members voted in favor of the rate increase. In particular, the rate hike is a…

3 years ago

Essentials

On The Resilience Of DM Energy Stocks

Oil Prices have gone through a dramatic boom bust cycle over the past 18 months. After rising almost 80% in the first quarter of 2022 following the war in Ukraine, Brent has fallen all the way back towards $70/bbl – where it was at the start of last year. In…

3 years ago

Essentials

Bond Market Positioning Is Very Bullish

BCA Research’s US Bond Strategy service recommends investors maintain above-benchmark portfolio duration. However, the team is monitoring bond positioning as a potential catalyst that could push yields higher. JP Morgan’s Treasury Investor Sentiment Survey…

3 years ago

Essentials

Canada’s Policy Rate Is Not Sufficiently Restrictive

Recent economic data reveal that Canadian household conditions remain resilient. Retail sales surprised to the upside in April. The 1.1% m/m increase follows two consecutive monthly declines and beat expectations of a 0.4% m/m rise. Similarly, the Bank of…

3 years ago

Developed Countries

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