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Economy

Eurozone Succumbs To A Technical Recession
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…
Daily Insights
Still Too Early To Take Equity Risk
Near the half-year mark, it is safe to say 2023 has been different than 2022 for equity investors. After being brought down in bear market territory by Europe’s energy crisis and sudden global shift to hawkish monetary policy in 2022, the S&P 500 was…
Daily Insights
The AI Euphoria Is Reaching Exhaustion
According to BCA Research’s Counterpoint service, an analysis of the AI rally’s complexity suggests that the rally is nearing a potential reversal point. Can the AI euphoria continue to drive the S&P 500 higher? It’s possible, but there are two…
Daily Insights
Macro Investors Are About To Make A Huge Mistake: An Update

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.

Global Investment Strategy by Peter Berezin
Manufacturing PMIs, The Real Economy, And Commodities

Slowing manufacturing PMI indices globally indicate the slowdown in economic activity will persist. Manufacturing demand for commodities will also soften, weighing on industrial commodity prices. Geopolitical tensions and the race to the green energy transition will upend enmeshed global supply chains, which will also impact manufacturing activity. It is possible that stimulus in China will arrest the decline in the state’s manufacturing activity, which will have positive spillover effects to its key trading partners.   

Commodity & Energy Strategy
Chinese Exports Return To Contraction
Chinese trade data delivered a disappointing signal about the global manufacturing cycle. After a brief rebound in March and April, exports dropped by 7.5% y/y in USD terms last month – below consensus estimates of a 1.8% y/y decline. The decrease was…
Daily Insights
A Return To Rate Hikes For The Bank Of Canada
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…
Daily Insights
Lower Eurozone Inflation Expectations Foreshadow Slower Wage Growth
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…
Daily Insights
Potential Drivers Of An Earnings Rebound
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…
Daily Insights
Markets Are Failing The Rorschach Test

What’s going on? The market-weighted stock market is up. But the equally-weighted stock market is not up. Neither is credit. Neither are industrial metal prices. Neither is the oil price, despite two waves of OPEC output cuts. We explain the dichotomy. Plus: European basic resources stocks can rebound, but Netherlands is likely to reverse.

Counterpoint by Dhaval Joshi

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