Hot May inflation should not derail Banxico’s easing cycle; we remain long Mexican local bonds. Headline inflation accelerated to 4.4% y/y from 3.9%, above expectations, while core inflation was roughly flat at 4.1% from 3.9%. The…
The US economy has held up better so far this year than we had expected. For the time being, investors should remain modestly underweight equities. A more aggressive underweight would be justified only once the “whites of the…
For now, measures of labor market utilization (like the unemployment rate) are only gradually weakening. But we know from history that these trends have a habit of quickly accelerating in advance of recession.
Our Counterpoint Strategists see no signs of recession or market fragility but remain skeptical of US superstar stocks. Winners of past tech cycles rarely lead the next, making Web 2.0 firms unlikely beneficiaries of the AI-driven…
Global growth showed tentative signs of improvement in May, but it is too early to call it a turning point. Our Chart Of The Week comes from Mathieu Savary, Chief European Investment Strategist. BCA’s nowcast for global industrial…
The May US jobs report reinforces our defensive stance as labor momentum is slowing even if not collapsing. Payrolls rose 139k, beating estimates, but decelerating from a downwardly revised 147k. Two-month revisions cut 95k jobs,…
The ECB’s expected rate cut to 2% marks a slower easing phase, capping Bund yields. The shift to a quarterly pace of cuts, barring surprises, confirms a more gradual approach despite ongoing disinflation and weak growth. Staff…
India's IT service exports have been booming and will continue to do so despite wider AI usage. Indian IT stocks, however, will not benefit from it as the expanding Global Capability Centers (GCCs) in India compete with the nation’s…
The May ISM Services PMI sent a stagflationary signal, reinforcing the case for defensive positioning. The headline index slipped into contraction at 49.9 from 51.6 in April, missing expectations. New orders collapsed to 46.4 from 52…
Our PMA strategists published Part 2 of their Capital Market Assumptions update, focusing on Direct Lending. They project gross annualized returns of 7.7% unlevered and 10.7% levered for Global Middle Market Direct Lending, and 6.5%…