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Daily roundup of research and analysis what The Globe and Mail’s market strategist Scott Barlow is reading today on the Web

BMO chief strategist Brian Belski sees Canadian stocks as a safe haven for global investors,

“In fact, investors should look no further than their own backyard, as our work shows Canada offers many key points of stability within global equity markets. Indeed, the resource sectors have been the primary driver of recent outperformance and is likely to remain a core area of stability while the ongoing supply shocks persist. Additionally, the S&P/TSX has maintained a strong relative value play within global equities – even after its strong relative performance – thereby providing another layer of attractiveness within global equity markets. In fact, our work shows the valuation advantage remains broad-based, with strong relative value in almost all sectors, including key areas like Financials and even Technology. Furthermore, the strong income nature of Canadian equities and the upswing of dividend growth that is well ahead of the rate of inflation adds income protection in an increasingly volatile environment.”


Citi software strategist Fatima Boolani interviewed senior FBI official Sean Puhalovic to discuss the increased cybersecurity threats arising from the Russian invasion of the Ukraine,

“Unlike historical cyberattack tactics and activity (low-scale, low-skill, sporadic frequency), the standoff with Russia could prove more malicious this time as the threat landscape becomes more pernicious/sophisticated, threat actors and related offensive tools proliferate in vast numbers, and nation states become better financially-endowed and motivated… critical industries appear most susceptible targets for retaliation - the financial services sector could be at the highest risk as Russia looks to recuperate losses from the worsening economic sanctions imposed. Infrastructure and natural resources (oil & gas) were also cited as vulnerable sector targets… Agent Puhalovic believes the crippling of US infrastructure, including communications and electric grids, would constitute “an act of war … We believe any budgetary increases are most likely to prioritize incident response, breach remediation and assessment services, along with more reliance on managed/outsourced security services reinforcements, with med-term spend skewing towards reinforcing infrastructure protection around on-prem/Cloud networks and endpoints, and also security awareness/testing. In this vein, we see CRWD (10% of the business), PANW (Crypsis/Unit42 group 3-5% of the business), and to a lesser extent RPD as favorably exposed to the first-leg of consultative, project-based burst spending”

“Citi: “Critical industries appear most susceptible targets for retaliation” from Russian hackers” – (research excerpt) Twitter


BofA Securities economist Carlos Capistran raised his economic growth projections for Canada while reaffirming his belief that the Bank of Canada will raise rates at every upcoming meeting,

“We now expect GDP growth at 4.2% this year (4.0% before) and inflation to end the year at 4.4% (3.5% before). We expect the BoC to hike 25 basis points at every remaining meeting in 2022 to put the policy rate at 2.0% by year end (1.75% before)… Large increase in commodity prices brought about by the Russia-Ukraine conflict is a positive terms of trade (ToT) shock for the economy … The main negative impact from the conflict on the Canadian economy will be through lower global growth and the impact of higher domestic inflation and higher interest rates on expenditure. On global growth, we just lowered our estimate to 3.6% from 4.3% before, in part driven by lower growth in the US now at 3.3% from 3.6% before … We now expect inflation to end this year at 4.4% instead of 3.5%, but we still expect it to eventually converge to the 2% target. We have it at 2.1% by end 2023 (2.0% before).”

“BofA raises Canadian GDP forecast” – (research excerpt) Twitter


Newsletter: “A new era begins for commodity prices” – Globe Investor

Diversion: “The World’s First Person to Receive a Genetically Modified Pig Heart Has Now Died” – Gizmodo

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