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United States

Shock-Proof Your Portfolio
According to BCA Research’s Counterpoint service, on a timeframe of two years, investors should shock-proof their portfolios by holding some combination of cheap insurance assets. All shocks end up with both deflationary and inflationary components: either…
Daily Insights
Banking Crisis Lifts Commodities Uncertainty

The crisis hitting regional and local banks in the US is adding to oil-price volatility and gold demand. The crisis arguably is fallout from the Fed’s aggressive monetary policy tightening, and contributes to the upending economic relationships that reliably informed policy, investments and forecasts in the past. This feeds into higher price volatility, which reduces liquidity in the short run, and impedes capex in the long run, which limits future supply growth.

Commodity & Energy Strategy
US Price Pressures Continue To Recede
As expected, annual core CPI inflation slowed from 5.6% y/y to 5.5% y/y in April. Meanwhile, the month-on-month figure was broadly unchanged at 0.4% m/m. A look at the details of the report through the lens of the Fed’s breakdown of core inflation into core…
Daily Insights
Job Switchers Are Driving The Deceleration In Wage Growth
Workers who switch jobs typically experience faster wage growth than those who do not change jobs. Data from the Atlanta Fed’s wage growth tracker shows that the GFC is the only period on record of faster wage growth for Job Stayers than Job Switchers. The…
Daily Insights
On Platinum’s Shrinking Discount To Palladium
After a decade of underperforming palladium, platinum prices have started regaining lost ground. While palladium prices have declined by 27% since the end of Q3, platinum prices are up 28%. Multiple forces are at play. Both metals are used in catalytic…
Daily Insights
US Bank Stock Underperformance: Blame It All On Bond Losses?
The turmoil within the US regional banks over the past two months has resulted in a notable, and widening, divergence in the performance of US and European bank shares. Since the beginning of March, just before the problems with Silicon Valley Bank become…
Daily Insights
Inflation Downtrend Intact

April’s CPI report was soft enough to justify a Fed pause in June. However, the overall economic data still don’t justify the magnitude of rate cuts priced into the yield curve.

US Bond Strategy
Shock-Proof Your Portfolio While Insurance Is Cheap

There is a 50:50 chance of experiencing a major deflationary shock in the next two years, and an even greater likelihood on a longer timeframe. The good news is that several assets provide a good insurance against this risk, and that this insurance is now cheap. Plus we highlight a compelling commodity pair-trade.

Counterpoint
US Small Business Sentiment At Decade Low
Results of the US NFIB survey show small business sentiment dipped to a decade low in April. To the extent that small businesses are more exposed to domestic economic dynamics, the survey provides a good update on economic conditions in the US. On this…
Daily Insights
Small: Sell In A Bounce
Small is out of investors’ favor yet again and is down 13% off its February 3rd peak. The S&P 600 is now unusually cheap and trades 13x forward earnings, a 25% discount to the S&P 500. According to the BCA Technical indicator, Small is also oversold. …
Daily Insights

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