Invesco Canada blog

Insights, commentary and investing expertise

U.S. stocks plunge in tech-fueled rout


October 11, 2018
Subject | Invesco | Macro views

On Wednesday, U.S. stocks fell dramatically, with the Dow Jones Industrial Average falling more than 800 points. The rout was led by technology stocks, with the NASDAQ Composite Index down 316 points, but all sectors experienced losses.1 This was the worst one-day sell-off for U.S. stocks since February. For much of the day, bonds sold off as well but, by the end of the day, investors fled to the perceived safety of U.S. Treasuries, sending yields lower.

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Five things to watch in October

Perhaps the biggest news of the last week was the meeting of the Federal Open Market Committee (FOMC), the policy-making arm of the U.S. Federal Reserve (Fed). As expected, the Fed raised interest rates. But what was far more interesting were the hints provided about the future. In this blog, I discuss my outlook for the Fed and highlight five issues to watch in October.

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Stocks shrug off rising geopolitical risks


September 25, 2018
Subject | Invesco | Macro views

Last week brought bad news on trade and Brexit, yet stocks globally shrugged off the news and rose higher. In the U.S., the S&P 500 Index hit new highs (albeit on low breadth), while the yield on the 10-year Treasury bond surpassed the key 3% level.1 Because the 10-year U.S. Treasury yield tends to be a far more accurate fear gauge than any equity indicators (such as the VIX), I can’t help but be fixated on a few questions: Why did the 10-year yield rise? And where will it go from here?

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Trade remains the top concern for global markets


September 11, 2018
Subject | Invesco | Macro views

Every week I hope that there are no new trade developments, so that for at least one week I can spare you all from a trade discussion in this blog. Unfortunately, this is not that week – there were many trade developments over the past few days, and I feel compelled to discuss them because I firmly believe the trade situation poses a significant risk to the economy and markets.

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Reading the tea leaves from the central banks


August 28, 2018
Subject | Invesco | Macro views

What did we learn last week from the central banks, trade talks and the markets?

Last week gave us a look into the thoughts of the U.S. Federal Reserve (Fed) as Fed Chair Jay Powell gave a widely anticipated speech, and the Federal Open Market Committee (FOMC) released the minutes from its most recent meeting. Some of the messages were clear, while other statements required observers to read between the lines. Below are five key takeaways from last week, and five items I’m watching going forward:

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What currency pressures in Turkey and other countries may mean for investors


August 14, 2018
Subject | Institutional | Invesco | Macro views

Activity in currency markets has more than tripled in the last two decades. Between 2001 and 2016, global turnover in currency markets rose from $1.2 trillion to $5.1 trillion,1 and the geopolitical disruption of the last two years has increased currency activity even further. Last week brought several significant examples of this trend in the U.K., China, Iran and – most dramatically – Turkey. Is this a sign of more disruption to come?

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Is it time to worry about a liquidity crisis?


July 31, 2018
Subject | Invesco | Macro views

One of the key risks to markets that I’ve been discussing for more than a year is balance sheet normalization. I have argued — and continue to argue — that quantitative easing was a big experiment, and so unwinding it is an experiment in and of itself. Now that balance sheet normalization has been in force for more than half a year, we are seeing its effects. And one key effect is on liquidity.

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Trade wars: A worldwide web of worry


July 24, 2018
Subject | Invesco | Macro views

Global stocks have been in positive territory thus far in July with even emerging markets stocks eking out a tiny gain.1 With positive returns and relatively low volatility in July, it appears that the stock market is not worried about the burgeoning trade war. Admittedly, it’s easy to ignore since investors don’t have a frame of reference for the impact of a major trade war – and so far, earnings season has been very good. But other markets may be telling us that we should be worried.

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Tariffs, earnings and politics: What’s moving markets this week?


July 17, 2018
Subject | Macro views

There is no shortage of events to watch this week: The European Union and China will meet to discuss foreign investment, Russian President Vladimir Putin and U.S. President Donald Trump are meeting in Finland, and U.S. Federal Reserve Chair Jay Powell gives his semi-annual testimony to Congress. But can any of these events direct the market’s attention away from the strong second-quarter earnings season?

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Six issues driving global markets


July 10, 2018
Subject | Institutional | Invesco

As I write this, early on July 9, global stocks have hit a two-week high1 and the price of copper is rallying. Markets are clearly focusing on positive data at the moment, which is a welcome change. Below, I highlight six important things that happened last week – both positive and negative – and several upcoming issues to watch.

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Six ways the trade situation deteriorated in the past week


July 3, 2018
Subject | Invesco | Macro views

I keep promising myself that I will stop writing about trade and protectionism in my weekly commentaries. And then virtually every week, something happens that forces me to address the topic once again. This past week, unfortunately, was no exception. In my mid-year outlook, I mentioned that my outlook is predicated on the trade situation not worsening materially – so it’s important that we closely follow trade developments. Last week, there were six trade developments that are helping to place downward pressure on stocks:

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Central banks take centre stage


June 19, 2018
Subject | Invesco | Macro views

Central banks took centre stage last week, with a trifecta of major central bank meetings. The clear theme was that most major banks are at least taking small steps toward monetary policy normalization. However, the central banks that are tightening may be caught by surprise if the trade situation worsens – which I believe is a strong possibility.

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