Developed Countries
The lift to European investor sentiment from the ebbing energy crisis is now in the rear-view mirror. The German ZEW Indicator of Economic Sentiment fell back below 0 in May to -10.7 from 4.1. The negative reading indicates that the share of pessimists…
According to BCA Research’s US Equity Strategy service, investors should stay underweight banks on a tactical investment horizon as the banking turmoil is far from over, and the industry’s profitability will be under pressure. The team has been underweight…
The US Retail Sales report painted a resilient picture of American consumers in April. Although the 0.4% m/m increase in overall retail sales fell below consensus estimates of a 0.8% m/m rise, the details of the report surprised to the upside. In particular,…
Recent Canadian data releases have raised concerns that the Bank of Canada may abandon the conditional pause it first telegraphed following its last rate increase on January 25 in favor of more policy tightening. Headline CPI inflation unexpectedly…
The S&P 500 Industrials index has gained 19% since its October 2022 lows and outperformed the S&P 500 gains of 15%. The sector has benefitted from American companies' efforts to "onshore" supply chains, but the deteriorating global industrial cycle…
The New York Fed’s Empire State Survey sent a pessimistic signal about US manufacturing conditions in May. The headline index plunged by 42.6 points to -31.8 – the largest monthly decline since April 2020 and below expectations of a milder decrease to -3.9.…
After a period of significant underperformance in 2022, US Growth stocks are regaining lost ground vis-à-vis Value. The S&P 500 Growth index has outperformed its Value counterpart by 7 percentage points since the start of the year. Notably, most of…
The US banking system remains unsettled over two months after the failures of Silicon Valley Bank. The two weeks following regulators’ seizure of First Republic (FRC) have featured dizzying swings in the stock prices of several regional banks as investors…
According to BCA Research’s European Investment Strategy service, a large set of variables points to some additional correction in European stocks over the coming months. The collapse in the Euro Area M1 is consistent with a significant decline in Eurozone…
The conventional economic thinking about the likely impact of AI is misguided because it extrapolates linearly from what AI can do today to what it can do tomorrow. Just as the investment community and the broader public were blindsided by the exponential rise in Covid cases during the early days of the pandemic, they will be blindsided by how quickly AI transforms society and the economy.