Inflation/Deflation
According to the Exposure Index compiled by the National Association of Active Investment Managers (NAAIM), active risk managers are increasing their net exposure to equities. The range of responses to the weekly survey include 200% leveraged long,…
Chinese producer prices sent a disappointing signal about the domestic economy on Friday. The pace of decline in producer prices accelerated from -3.6% in April to -4.6% in May – worse than expectations of a -4.3% drop. The decrease was particularly…
As we’ve highlighted in recent Insights, the S&P 500’s year-to-date rally has been concentrated among a few mega cap stocks. In particular, companies that benefit from the AI craze have driven the gains. This dynamic is also reflected in the sector…
According to BCA Research’s Global Investment Strategy service, the leading indicators of inflation continue to point down, suggesting that the Fed may be able to finally go on hold after hiking one last time in July. Earlier this year, the team predicted…
A preview of what to expect from next week’s FOMC meeting.
The final Q1 GDP release shows the Euro Area economy contracted by 0.1% q/q last quarter, a downwards revision from estimates of a 0.1% expansion. To the extent that this follows a 0.1% q/q decline in Q4 2022, the revised numbers indicate that the Euro Area…
A benign disinflation will support equities over the next few quarters. Stocks will fall next year as a recession begins when investors least expect it.
The Bank of Canada (BoC) surprised markets with a 25bp hike yesterday, bringing the policy rate up to a 22-year high of 4.75%. This ended the pause on rate hikes announced back in March, which only ended up lasting two meetings. The Canadian bond market…
Eurozone households are becoming less concerned about the near-term outlook for inflation. The results of the latest ECB Consumer Expectations survey show a significant drop in median 12-month inflation expectations from 5.0% in March to 4.1% in April – the…
According to BCA Research’s US Equity Strategy service, the earnings contraction is far from over. However, rising productivity, falling costs, or a new restocking cycle could help. Earnings and sales growth beat analyst expectations in Q1-23, yet in real…