Banks
Underweight Last month, we made a final defensive tweak to our portfolio and downgraded financials from overweight to neutral by trimming banks to below benchmark allocation. One of the reasons we focused on financials specifically, was our view that the yield curve has likely peaked for this…
Dear Client, Next week, instead of our regular report, we will be sending you a Special Report from BCA Research’s MacroQuant tactical global asset allocation team. Titled “MacroQuant: A Quantitative Solution For Forecasting Macro-Driven Financial Trends,” this white paper will discuss the…
Dear Client, In this special report we are pleased to introduce Ritika Mankar, the newest Strategist to join BCA Research and Geopolitical Strategy. Ritika hails from Mumbai where she has led a distinguished career as a director at Ambit, an institutional equity brokerage, leading one of the…
Highlights Asset Management Regulation (AMR) represents a critical and successful structural reform that is defusing risks in the most hazardous parts of China’s credit system. This bodes well for long-term sustainability of the nation’s financial system and, hence, its long-term economic…
Underweight As a follow up to yesterday’s Sector Insight report where we reiterated our S&P financials downgrade, today we cover banks that were used as the vehicle to trim financials to a neutral allocation. Housing starts and permits came off the boil last week and failed to live up to…
Highlights Portfolio Strategy The rising shadow fed funds rate and related flattening of the yield curve, eerie similarities with the 2009/10 episode, overbought technicals, and extended sector breadth, all signal that financials are due for a breather. Downgrade to neutral and lock in…
Highlights EM banks will underperform their DM peers in the next six months due to worsening relative NPL dynamics and shrinking net interest margins. EM banks will either continue experiencing rising NPLs and moribund loan demand due to restrictive lending rates or will have to reduce their…
Highlights Our baseline view is that inflation will increase only modestly over the next few years before accelerating in the middle of the decade. Nevertheless, the risks are skewed towards an earlier and sharper increase in inflation in the US and, to a lesser extent, in the other major…
Dear Client, We are sending you our Strategy Outlook today, where we outline our thoughts on the macro landscape and the direction of financial markets for 2021 and beyond. Next week, please join me for a webcast on Thursday, December 17 at 10:00 AM EST (3:00 PM GMT, 4:00 PM CET, 11:00 PM HKT)…
Highlights According to betting markets, Joe Biden is likely to become the 46th US president, with the Republicans maintaining control of the Senate. Such a balance of power could produce less fiscal stimulus than any of the other possible outcomes that were in play on Tuesday. Nevertheless,…