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Daily roundup of research and analysis from The Globe and Mail’s market strategist Scott Barlow

TD Securities head of global strategy Rich Kelly and his team are the most bearish on global growth of any research firm I have seen,

“While we spent much of our 2023 outlook focused on inflation and the resulting policy rate response, 2024 is very much about the duration and severity of growth downturns, and the resultant easing we expect from central banks. And this is where we draw the clearest line in the sand between our forecasts and those of the market: with 2024 GDP growth likely to be well below 1.0 per cent for the U.S., euro area, and UK, and inflation returning steadily toward target, the pace of central bank rate cuts throughout the year is likely to be much faster than markets currently expect. The fact that the euro area and Canada, and the UK are all likely to post negative or zero growth for 2023Q3 sets an early stage for a stagnant 2024″

TD economists expect Canadian GDP growth below 1.0 per cent in 2024 and 0.7 per cent for the U.S. remarkably, TD expects 250 basis points of Federal Reserve rate cuts beginning in the middle of 2024.


BMO senior economist Robert Kavcic notes that domestic housing starts are running well ahead of where sales levels say they should be,

“Canadian housing starts rose to 274,700 annualized units in October from just over 270k in the prior month, an impressive show of resilience given the headwinds facing real estate more broadly. Over the past six months, starts have now averaged 256k annualized, and they’ve run at 248k over the past 12 months. This is a very solid effort considering higher borrower costs and less investor demand (e.g., presales). Note that starts tend to follow sales down but, as the chart shows, they’re breaking tradition at the moment. Torrid population flows are putting a floor under the physical market, even as the asset price is under pressure”.

“BMO: “Builders Gonna Build… in Canada”” – (research excerpt, chart) Twitter


Jefferies strategist Christopher Wood made an important point about a potential rally in the “Magnificent 7″ megacap stocks into year end.

That group consists of Alphabet Inc., Inc., Apple Inc., Meta Platforms Inc., Microsoft Corp., Nvidia Corp. and Tesla Inc.

“The performance of the Magnificent 7 shares remains extraordinary relative to the rest of the US stock market. They are now up an average 100 percent year-to-date compared with an estimated 3.4-per-cent gain for the rest of the S&P500 . For active fund managers who have been underweight them this year the pressure to own them, in the run up to year end, must now be enormous”


Diversion: “Winners of the 2023 natural landscape photography awards” – The Atlantic

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