Latest from BCA Research

Special Report

The dollar's retreat is creating the most compelling window for euro internationalisation since Maastricht, but Europe is missing the one instrument that would make it real. In this report, we make the case for the Eurobond, assess which model is most likely to prevail, and explain why the trade is long euro on dips and overweight Central and Eastern European sovereign spreads.

Special Report

Democrats are likely to win big in this year's midterm elections. Our new quant model still slightly favors Republicans for the Senate, but we expect the oil shock to deliver surprise Democratic victories.

In this screener report, we explore opportunities in Inflation risk, supply-constrained Information Technology stocks, and old-economy cyclicals.

The April CPI report showed clear evidence of the direct effect of higher oil prices on inflation but, so far, limited evidence of passthrough to core.

Special Report

Private Equity fund vehicles may extend beyond 10 years, but the underlying assets that drive performance typically do not. We provide the framework for investors to capitalize on this reality.

Equities have thrown caution to the wind for much of April and early May. We do not disagree with the sanguine mood, but caution that the Hormuz saga is far from over. Still, the AI capex mania continues and the labor market is firming in the US, suggesting that there is more upside to equities.

The investment cycle remains firmly intact, driving equity prices and fundamentals, as confirmed by both Q1 data and corporate commentary. Upside surprises, expanding margins, and rising capex expectations point to resilient demand. Companies confirm that AI-related demand is broad and visible, while geopolitical and credit risks remain contained and not yet systemic.

We take stock of earnings, AI capex and the labor market and explain why we think the repeated new highs in the S&P 500 are justified.

The US High Quality (USHQ) portfolio underperformed its benchmark through April, returning 7.02%, while its SPY benchmark returned 11.55%. On a trailing three-month basis, the USHQ portfolio’s performance was weaker than the benchmark as well, with USHQ underperforming by approx. 338bps.

Improving job growth keeps Fed rate cuts off the table, but evidence of labor market tightening will be required before rate hikes become part of the discussion.