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Developed Countries

FICC
A Cross-Country Look At Corporate Bond Sector Valuations

The messages from the deteriorating fundamental backdrop (tight monetary policy, slowing global growth) and improved credit valuation (elevated 12-month breakeven spreads) are giving conflicting signals on corporate bond strategy. We are putting more weight on the fundamentals and are staying with an overall underweight stance on global investment grade corporates, with a slight bias towards Europe given more attractive spread valuations. At the same time, we see selective opportunities in sectors where risk-adjusted spreads are wide as signaled by our individual country sector valuation models, like US Energy and euro area Financials.

Deborah Acri
3 years ago
Bonds
Essentials
US PPI Inflation Slows In October
US PPI inflation slowed to a lower-than-expected 8.0% y/y in October from a downwardly revised 8.4% y/y. Similarly, core PPI inflation eased to 6.7% y/y from 7.1% y/y, below expectations of 7.2% y/y. Both core goods and services contributed to the decline. …
3 years ago
Essentials
German Investors Becoming Less Pessimistic
November’s reading of the ZEW Indicator of Economic Sentiment reveals that investors are becoming less pessimistic about the Eurozone economy. The expectations and current situation indices for Germany and the Euro Area jumped significantly above consensus…
3 years ago
Essentials
US Equities Are No Longer Oversold
The Fed’s aggressive hawkish pivot at the start of the year triggered a sharp selloff in US equities that pushed the S&P 500 deep in oversold territory. Just one month ago, our composite tactical technical indicator was signaling that the equity drawdown…
3 years ago
Essentials
Credit Card Payment Processors: Living On Borrowed Time
BCA Research’s US Equity Strategy service is overweight credit card companies, but only over a short investment horizon. All of the largest credit card processing companies, such as Visa, Mastercard, and American Express, have delivered strong Q3-22 sales…
3 years ago
Essentials
Eurozone IP Delivers Second Consecutive Positive Surprise
Euro Area industrial production expanded by 4.9% y/y in September, following an upwardly revised 2.8% y/y and beating expectations of a 3.0% y/y increase. Similarly, the 0.9% m/m increase also exceeded consensus estimates of 0.5% m/m. Higher production of…
3 years ago
Essentials
NY Fed Inflation Expectations Rebound
Results from the New York Fed’s October Survey of Consumer Expectations underscore that the Fed still has its work cut out for it. Household inflation expectations rebounded with median one-year-ahead expectations increasing from 5.4% to 5.9%,…
3 years ago
Essentials
Headwinds Abound For Europe
According to BCA Research’s European Investment Strategy service, although the decline in US CPI is a tailwind for European stocks, strong rallies are premature. Chinese growth shows no sign of improvement. Similarly, the collapse in the global PMI’s new…
3 years ago
Equities
Will Americans Continue To Spend?

In this report we scrutinize the state of US consumer finances, which are a key driver of the Payment Processing Industry. We expect demand for services to pull back in the early 2023 on the back of still high inflation and tighter monetary policy. The payment processing companies thrive but live on borrowed time. We are overweight for now but monitor this position closely.

Irene Tunkel
3 years ago
US Equities
CoreMacro
The Conflict: CPI vs Growth

The decline in the US CPI is a tailwind for European stocks, but does it compensate for weaker global growth?

Mathieu Savary
3 years ago
Europe

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