Daily roundup of research and analysis from The Globe and Mail’s market strategist Scott Barlow
BofA Securities U.S. economist Michelle Meyer highlighted a remarkable ramp-up (even versus low comparables) in credit card spending,
“Total card spending, based on aggregated BAC credit and debit card data, increased at an 82% 1-year pace and 20% 2-year rate for the 7-day period ending March 27th … Buying more ‘stuff’: We compare the change in the 2-year growth rates in spending by major category pre and post stimulus (28 days prior to March 17th vs. March 17 to March 27th) for stimulus vs. non-stimulus recipients. This shows the biggest relative gain in furniture sales with online electronics, clothing and dept stores in a close second. Airline spending also saw a relative boost while restaurant spending picked up modestly more than grocery.”
“@SBarlow_ROB BAC credit card spending up 82% yoy” – (research excerpt) Twitter
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Morgan Stanley U.S. equity strategist Michelle Weaver emphasized the firms’ belief in sustainable inflation pressure and provided a list of stocks most correlated with inflation breakevens, which measure the difference in nominal and inflation-adjusted ten-year bond yields,
“We think inflationary pressures will prove more durable than the market expects as fiscal policy, excess savings, pent up demand, and supply chains strained by reopening create a high pressure economy. Personal consumption expenditure pricing on goods, home pricing, trimmed mean CPIs, food pricing, and commodity prices all stand out for having recent rates of change that look elevated vs history.”
The list of stocks starts with Quanta Services Inc., Southern Copper Corp., Haliburton Co., ConocoPhillips , APA Corp., Continental Resources Inc., Helmerich & Payne Inc., Targa Resources Corp., EOG Resources Inc., Marathon Oil Corp. and Univar Solutions Inc.
“@SBarlow_ROB MS: U.S. stocks most correlated with breakevens” – (table) Twitter
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Credit Suisse analysts provided a list of top Canadian stock picks with a six-to-12 month time frame. The stocks (not ranked) are Element Fleet Management Corp., Royal Bank, Sun Life Financial, Transalta Corp., AltaGas Ltd., Brookfield Business Partners LP, Suncor Energy Inc., Newmont Mining Corp., Agnico Eagle Mines Ltd. and Endeavour Mining Corp.
There are two stocks with strong Canadian ties in Credit Suisse’s list of top U.S. companies – Teck Resources Ltd. and Crown Holdings Corp. Other prominent names on the U.S. list include Amazon.com Emerson Electric, Caterpillar, IBM, JP Morgan Chase and UPS.
“@SBarlow_ROB Two Canadian stocks among CS’s top U.S. picks” – (table) Twitter
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Diversion: “15 questions about the AstraZeneca vaccine in wake of new recommendations” – Macleans
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Scott Barlow