We have been worried about the deterioration in Chinese economic data amidst a rebounding dollar and over-extended prices for cyclical relative to defensive equities (see Today’s Pick). Nonetheless, we do not expect any…
According to BCA Research’s Foreign Exchange Strategy service highlights a tactical opportunity to go short the AUD/MXN cross. Three catalysts underpin this thesis: relative economic activity, valuation, and sentiment.…
A tactical opportunity has emerged whereby investors should buy Russian stocks at the expense of the remainder of the EM benchmark. To begin with, Russian equities are cheap compared to other EM. On a relative price-to-book,…
Highlights For the month of February, our trading model recommends shorting the US dollar versus the euro and Swiss franc. While we agree a barbell strategy makes sense, we would rather hold the yen and the Scandinavian currencies.…
BCA Research’s Emerging Markets Strategy service concludes that we are in a euphoria phase where fundamentals are less pertinent. The market can either rally or fall significantly, regardless of the profit outlook. In all…
Highlights There is too much euphoria and complacency in global markets. The main distinction between the current and previous episodes of speculative equity market excesses is that classic end-of-business cycle conditions –…
BCA Research’s Emerging Markets Strategy service recommends that investors should go long Indian banks and short EM banks. Indian bank stocks have been the star performers among emerging markets banks over the past 20…
Highlights Chart 1China's PMIs Dropped In January January’s official PMI suggests that China’s economic recovery started the year on a weaker note. While both manufacturing and non-manufacturing PMIs remain in…
BCA Research’s Emerging Markets Strategy service remains negative on the BRL. Brazilian stocks will only become a clear buy after their risk premium reflects fiscal challenges better. Rising resource prices and the…
China’s economic recovery moderated more than expected in January. The composite PMI released by China’s National Bureau of Statistics fell to 52.8 from 55.1 on the back of both weaker readings for the Manufacturing…