Nonetheless, “we believe that North America will avoid recession this year but have recalibrated expectations for lower economic growth,” the report said. However, the firm is “becoming more concerned” about a potential recession in Europe, due in large part to the macroeconomic impact of the war in Ukraine.
“Sanctions on Russia, curtailed energy exports from Russia to Europe and major interruption on the supply of globally important exporting regions, together with Covid-19 policies continuing to affect supply chains, have all contributed to sustained elevated pricing,” Mackenzie Investments said in a release.
“While inflation has been hard on growth-oriented markets, rising commodity prices could provide a boost to producer-oriented countries, such as Canada, supporting relative outperformance in Canadian equities.”
Commodities also were a “safe haven as a hedge in the wake of soaring inflation expectations,” according to the report.
The firm had predicted that March’s U.S. inflation rate of 8.5% “could mark the high for this cycle, although we won’t know for sure until the summer months.” Indeed, U.S. inflation hit 8.6% in May. Mackenzie Investments expects inflation to come down, but remain above the Fed’s 2% target, by the end of 2022.
The firm expects central banks to “follow a hawkish path” in the second half of this year.
As a result, Mackenzie Investments’ recommended being overweight on investment-grade bonds and Canadian equities; neutral on international and emerging markets equities, as well as high-yield corporate bonds; and underweight sovereign bonds and U.S. equities.
The report also noted that China faces persistent headwinds. Industrial production in the country “has likely contracted in Q2 due to logistics disruption and workforce lockdowns,” Mackenzie Investments said. However, the report predicted the slowdown in GDP growth in China “will bottom this year.”
Other headwinds affecting China include over-extended credit, inflated real estate values and de-globalization.
TORONTO – Canada’s main stock index was up more than 100 points in late-morning trading, helped by strength in base metal and utility stocks, while U.S. stock markets were mixed.
The S&P/TSX composite index was up 103.40 points at 24,542.48.
In New York, the Dow Jones industrial average was up 192.31 points at 42,932.73. The S&P 500 index was up 7.14 points at 5,822.40, while the Nasdaq composite was down 9.03 points at 18,306.56.
The Canadian dollar traded for 72.61 cents US compared with 72.44 cents US on Tuesday.
The November crude oil contract was down 71 cents at US$69.87 per barrel and the November natural gas contract was down eight cents at US$2.42 per mmBTU.
The December gold contract was up US$7.20 at US$2,686.10 an ounce and the December copper contract was up a penny at US$4.35 a pound.
This report by The Canadian Press was first published Oct. 16, 2024.
TORONTO – Canada’s main stock index was up more than 200 points in late-morning trading, while U.S. stock markets were also headed higher.
The S&P/TSX composite index was up 205.86 points at 24,508.12.
In New York, the Dow Jones industrial average was up 336.62 points at 42,790.74. The S&P 500 index was up 34.19 points at 5,814.24, while the Nasdaq composite was up 60.27 points at 18.342.32.
The Canadian dollar traded for 72.61 cents US compared with 72.71 cents US on Thursday.
The November crude oil contract was down 15 cents at US$75.70 per barrel and the November natural gas contract was down two cents at US$2.65 per mmBTU.
The December gold contract was down US$29.60 at US$2,668.90 an ounce and the December copper contract was up four cents at US$4.47 a pound.
This report by The Canadian Press was first published Oct. 11, 2024.
TORONTO – Canada’s main stock index was little changed in late-morning trading as the financial sector fell, but energy and base metal stocks moved higher.
The S&P/TSX composite index was up 0.05 of a point at 24,224.95.
In New York, the Dow Jones industrial average was down 94.31 points at 42,417.69. The S&P 500 index was down 10.91 points at 5,781.13, while the Nasdaq composite was down 29.59 points at 18,262.03.
The Canadian dollar traded for 72.71 cents US compared with 73.05 cents US on Wednesday.
The November crude oil contract was up US$1.69 at US$74.93 per barrel and the November natural gas contract was up a penny at US$2.67 per mmBTU.
The December gold contract was up US$14.70 at US$2,640.70 an ounce and the December copper contract was up two cents at US$4.42 a pound.
This report by The Canadian Press was first published Oct. 10, 2024.
