A roundup of what The Globe and Mail’s market strategist Scott Barlow is reading today on the Web
CBC reports that the relationship between U.S. and Canadian trade negotiators is not great,
“The third most senior Republican in Congress… [urged] Canadian negotiators to either drop some of their hardball tactics or risk being left out of a new NAFTA entirely. House Majority Whip Steve Scalise said he and other U.S. lawmakers are growing increasingly frustrated with Canada’s refusal to cede ground on some key sticking points standing in the way of a renegotiated trilateral trade deal, saying Canada alone is to blame for the ‘continued delay.’””
This could, of course, be posturing to put more pressure on minister Freeland’s team.
“'There is a growing frustration': Top Republican slams Canada's NAFTA negotiating tactics” – CBC
“Top Republican says Congress frustrated with Canada over NAFTA talks” – Report on Business
“U.S., Canada trade sharper barbs before resuming Nafta talks” – Bloomberg
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A Goldman Sachs report provides a simple but compelling strategy allowing stockpicking investors to benefit from flows into passive indexing funds,
“We create sector-neutral lists of the 50 most overweight and underweight passive stocks (see Exhibits 21 and 22). The most overweight stocks have returned 38% in the last 12 months vs. 23% for the most underweight stocks. US equity ETFs have seen $165 billion of inflows within this period while US equity mutual funds have had $290 billion of outflows. The most overweight passive stocks are BRK.B, DVMT, and FB.”
“@SBarlow_ROB GS: how active managers can benefit from passive inflows” – (research excerpt) Twitter
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It’s gotten to the point where opening general news websites poses a risk to sanity and sell-side research has been almost as bad. This is occurring despite that fact that little stress is evident in global market pricing. UBS recently added to the pessimism with a research report suggesting that “global trade appears to be rolling over",
“Developed market import volumes are running at an annualized rate of -4.8% YTD and emerging markets at +5.1% … We have pencilled in a 100 bp loss in global growth momentum by year-end (from 4.3% to 3.3%) though for now we still forecast that weakness to subside quickly so our forecast for 2019 is still only a touch below 4%.”
“@SBarlow_ROB UBS : "Global trade appears to be rolling over'” – (research excerpt) Twitter
“@SBarlow_ROB ML clients selling the equity rally” – (research excerpt) Twitter
“World stocks bat aside trade war fears, rally for second day” – Report on Business
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Tweet of the Day:
Diversion: “A mummified wolf puppy from the Ice Age was found by miners in Canada” – Bloomberg (video)
Scott Barlow