Skip to main content

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

It makes me nervous that Mexican officials feel the need to constantly restate the importance of Canada in trade negotiations because it implies that the U.S. doesn’t feel the same way.

BMO economists are also concerned,

Story continues below advertisement

“Trump was much more focused on ending NAFTA as we know it, dropping it in both name and openly stating that it will now be “terminated’ to make way for the new deal—whether that includes Canada or not. Still, financial market reaction has certainly been positive” , and in a separate report, “one thing is for sure: the country will almost certainly have to make major compromises in order to be part of the Three Amigos club again.”

“@SBarlow_ROB More BMO on NAFTA: "Trump was much more focused on ending NAFTA as we know it, dropping it in both name and openly stating that it will now be “terminated’ to make way for the new deal" – (research excerpt) Twitter

“@SBarlow_ROB BMO: " one thing is for sure: the country will almost certainly have to make major compromises in order to be part of the Three Amigos club again." – (research excerpt) Twitter

“‘Canada, you’re fired’: Canadian dollar has a lot riding on NAFTA as Ottawa in a squeeze play” – Babad, Report on Business

=====

Scotia economists have a much more optimistic view,

“Today’s Oval Office announcement of a preliminary understanding on a new ‘US-Mexico Trade Agreement’ is a fundamentally positive development in the NAFTA talks for the US, Mexico, and Canada. It should significantly reduce market-pricing of NAFTA risks.The apparent resolution of major US demands for tighter rules of origin on tariff-free trade in North American automobiles addresses the most important sticking points in the negotiations. Canada should find it relatively simple to join the US-Mexico consensus on automobiles.”

Story continues below advertisement

“NAFTA: Announcement of US-Mexico Trade Agreement Positive For Canada” – Scotia

******

A month ago there was a lot of concern about the narrowness of the U.S. equity rally as FAANG stocks were responsible for the bulk of market upside.

Goldman Sachs strategist David Kostin, however, noted that health care stocks have now taken over market leadership,

“Health Care has assumed market leadership from Information Technology, accounting for 27% of the index return during the past two months. Hedge funds have benefited from their increased overweight in Health Care. The sector is now hedge funds’ second largest net sector weight (17%) and the largest overweight versus the Russell 3000 (+417 bp).”

“@SBarlow_ROB kostin: Healthcare has taken over market leadership” – (research excerpt) Twitter

Story continues below advertisement

******

A Bloomberg report blames the bear market in copper almost exclusively on emerging markets currency weakness,

“Adding to copper’s woes, the Chilean peso has also been slumping. That’s lowering labor costs in the world’s top producer and creating an incentive for miners to ramp up output, [Guy Wolf, global head of market analytics at Marex Spectron] said. “The fundamentals for copper are fine, but if currencies continue to make it more expensive for China to buy and more attractive for Chileans to export, it’s only going to play out one way.””

“Copper Transfixed by Currency Swings With Record Link to Yuan” – Bloomberg

******

Tweet of the Day:

Diversion: “Study Causes Splash, but Here’s Why You Should Stay Calm on Alcohol’s Risks” – NY Times

Report an error Editorial code of conduct
Comments

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way. Click here to subscribe.

If you would like to write a letter to the editor, please forward it to letters@globeandmail.com. Readers can also interact with The Globe on Facebook and Twitter .

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way. Click here to subscribe.

If you would like to write a letter to the editor, please forward it to letters@globeandmail.com. Readers can also interact with The Globe on Facebook and Twitter .

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff.

We aim to create a safe and valuable space for discussion and debate. That means:

  • All comments will be reviewed by one or more moderators before being posted to the site. This should only take a few moments.
  • Treat others as you wish to be treated
  • Criticize ideas, not people
  • Stay on topic
  • Avoid the use of toxic and offensive language
  • Flag bad behaviour

Comments that violate our community guidelines will be removed. Commenters who repeatedly violate community guidelines may be suspended, causing them to temporarily lose their ability to engage with comments.

Read our community guidelines here

Discussion loading ...

Due to technical reasons, we have temporarily removed commenting from our articles. We hope to have this fixed soon. Thank you for your patience. If you are looking to give feedback on our new site, please send it along to feedback@globeandmail.com. If you want to write a letter to the editor, please forward to letters@globeandmail.com.
Cannabis pro newsletter