Latest from BCA Research

Investors should maintain a conservative and defensive strategy until recession risks are clearly reduced.

This month we begin tracking a US small-to-mid cap BCA Score strategy (USHQ SMID) along with the original USHQ strategy focused on the US Large cap space. Both strategies outperformed the benchmarks in November despite the BCA Score long/short finishing the month flat after an early month rally in low ranked stocks inspired by the US CPI release.

Special Report

China’s infrastructure investment growth rate will likely slow from its current nominal 14% to 4-6% in 2023H1, on a year-over-year basis. Funding constraints and a shrinking pool of good projects will cap the upside in China’s overall infrastructure fixed-asset investment (FAI) in the next six months.

This week we present our Portfolio Allocation Summary for December 2022.

Special Report

2023 will be another challenging year for the US equity market, characterized by the Fed’s battle with inflation, slowing economic growth, and earnings contraction. The S&P 500 is likely to reach new lows in the first half of the year falling as much as 20-25%, only to rebound sharply in the second half, once all the bad news is priced in.

Labor market strength and consumers’ evident willingness to dip into their pandemic savings keep our optimistic consumer thesis intact. We remain tactically overweight equities.

European inflation will decline through 2023, which will greatly help households and consumption. But can European inflation remain low after that?

MacroQuant remains bearish on risk assets and the style score turns positive on value vs. growth.

MacroQuant is overweight bonds, underweight equities, and neutral on cash. Within the equity universe, the model is underweight the US and overweight Japan, the UK, and Australia.

Bank Credit Analyst

The 2022 World Cup group stage is over. Take a look at the updated BCA World Cup forecasts.