Equities
Investors should prepare for an equity market pullback this fall, prefer Treasuries over stocks, and US defensives over cyclicals. A pullback could also morph into another bear market given that monetary policy is tight, policy uncertainty will spike, global growth is slowing, and geopolitical risks are still high.
Our Emerging Markets Strategy team expects a further decline in Indian stocks. Foreign equity inflows have been instrumental in the recent rally, but they will likely reverse in the coming months as risk-off sentiments pervade global financial markets. Indian…
Commentators often use notions like debt deflation, balance sheet recession, and liquidity trap interchangeably. Yet, these are different concepts. This report develops a framework and provides a diagnosis of China’s economic malaise. A follow-up report will deal with what kind of treatment is needed for a recovery. As a trade, we recommend shorting the EM equity index.
BCA Research's US Equity Strategy service downgraded Semiconductors to underweight for the following reasons: Weakening global growth: Global semiconductor sales move in lockstep with economic growth. Global growth continues to decelerate. The…
Investors are wondering about the risk of a US government shutdown as the September 30 deadline draws near. Would a shutdown be a significant negative catalyst for the stock market? While there is a high risk of a government shutdown, there are more…
According to BCA Research’s European Investment Strategy service, the earnings outlook of Eurozone equities will continue to deteriorate over the coming two quarters despite the improvement in real economic activity. Earnings and revenue growth are…
On Monday, Asia Pacific equity markets closed in the red due to the news that China’s largest real estate developer, Country Garden, is suspending the trading of some of its bonds. This recent episode is a continuation of Chinese economic woes, which our…
In a recently published report, BCA’s Bank Credit Analyst service reviewed the BCA Valuation Index, alongside three other US equity indicators which are published in Section III of each month’s report. The other indices included in our suite of equity…
BCA Research's US Investment Strategy service’s yearlong recommendation to overweight equities was founded on its high-conviction view that investors were underestimating American consumers’ resources and resolve. The consensus pooh-poohed the mountain of…
According to BCA Research’s US Equity Strategy service, the outperformance of Growth sectors most likely has run its course. The team has opened an overweight in Growth vs. Value in April. Since then, the trade is up 2.73%. They are now closing this…