Invesco Canada blog

Insights, commentary and investing expertise

Have the biggest mega-caps run too far?


August 14, 2020
Subject | Invesco

In 2020, U.S. equity markets have taken a path that few could have seen coming.  As a result, the S&P 500 Index has become more top-heavy than it’s been in 45 years. Below, I explain why this is the case, what it means for investors — and what they can do to help mitigate this concentration risk while maintaining exposure to the companies that make up this well-known benchmark.

Continued

Comments Off on Have the biggest mega-caps run too far?

The Evolution of ESG


February 27, 2020
Subject | ETFs | Industry views | Invesco

Responsible investing is becoming more mainstream as demand increases for strategies that incorporate ESG factors into their investment process. The drivers come from regulatory pressure, demographic shifts such as the growing influence of millennials, and the greater availability of corporate data on ESG issues. More generally, investors want their investments to align with their own values, especially if it offers the potential for better risk-adjusted performance.

Continued

Comments Off on The Evolution of ESG

What could the U.S.-Iran conflict mean for investors?


January 14, 2020
Subject | Invesco | Macro views

After the U.S. killing of Qassim Suleimani on Jan. 3 and Iran’s retaliatory, non-lethal missile strike against two U.S. military facilities in Iraq on Jan. 7, the situation appears to have de-escalated. However, investors continue to worry about the potential for this conflict between the U.S. and Iran to worsen. We do not believe that a war is likely at this juncture, but it is important to understand the potential effects that such a worst-case scenario could have on the markets.

Continued

Comments Off on What could the U.S.-Iran conflict mean for investors?

Five issues for investors to watch in January


January 7, 2020
Subject | Invesco | Macro views

2019 was a great year for markets, and equities delivered strong returns for the year. U.S. stocks led the way at 29.07%, Chinese stocks returned 20.94%, European stocks returned 20.03%, and emerging markets delivered 15.42%.1 But the ride wasn’t always smooth, with ongoing geopolitical sagas (like Brexit) and short-term market events (like the inverted yield curve) rattling markets – and investors’ resolve – along the way.

Continued

Comments Off on Five issues for investors to watch in January

What does Qassim Suleimani’s death mean for the market?


January 7, 2020
Subject | Invesco | Macro views

On Thursday evening, Iran’s top security and intelligence commander, General Qassim Suleimani, was killed in a drone strike at Baghdad International Airport. The strike, which was authorized by U.S. President Donald Trump, represents a potentially dangerous escalation in the growing confrontation between the U.S. and Iran.

Continued

Comments Off on What does Qassim Suleimani’s death mean for the market?

Reflections on my recent visit to China


December 6, 2019
Subject | Institutional | Invesco

In my recent visit to China, I met with a variety of clients, as well as digital companies. In spite of the overhang of the U.S.-China trade wars, everyone I spoke with remained optimistic about the opportunity for further investment in this important market and broadly bullish in their long-term economic outlook.

Continued

Comments Off on Reflections on my recent visit to China

Fed cut meets market expectations, but future cuts are in doubt


September 20, 2019
Subject | Invesco | Macro views

The U.S. Federal Reserve (Fed) cut interest rates by 25 basis points Wednesday to a range between 1.75% and 2%, as widely expected by markets. However, the Fed’s economic projections showed that the median Federal Open Market Committee (FOMC) member does not expect to cut rates again this year, marking potential disagreement among FOMC members and with markets; the bond market is currently pricing an additional rate cut this year and some FOMC members have expressed interest in future cuts.

Continued

Comments Off on Fed cut meets market expectations, but future cuts are in doubt

Measure twice, cut once: Fed delivers expected cut


August 1, 2019
Subject | Invesco | Macro views

The U.S. Federal Reserve (Fed) cut rates by 0.25% for the first time in over a decade,1 a move largely expected by the market. Heading into the July Federal Open Market Committee (FOMC) meeting, much of the debate was around whether or not the Fed would deliver 25 or 50 basis points. However, we were focused on the statement and Fed Chairman Jerome Powell’s press conference for further insight on future policy. Future policy, or the Fed’s reaction function, is particularly important as we navigate in an environment where we believe market pricing indicates more cuts than our economic outlook would imply.2

Continued

Comments Off on Measure twice, cut once: Fed delivers expected cut

This week the Fed will remind us that it’s the world’s central bank


July 29, 2019
Subject | Invesco | Macro views

Back when I was in high school, I worked as a lifeguard. I thought it would be a great job, with an opportunity to get a tan and do some summer reading. However, it was a lot of responsibility for a 15-year-old, and I found myself running around with a first aid kit, bandaging cut toes and knees, and even having to perform a water rescue in my first few weeks on the job. I soon realized that I could save myself a lot of trouble, especially since I hated the sight of blood, if I strictly enforced the rules – like no running in the pool area – in order to pre-empt accidents and other mishaps.

Continued

Comments Off on This week the Fed will remind us that it’s the world’s central bank

Waiting for a rate cut: How much is too much?


July 16, 2019
Subject | Institutional | Invesco | Macro views

As any parent of toddlers or teenagers knows, there’s often a big difference between what kids want (candy and a later bedtime) and what they need (vegetables and plenty of rest). I’m reminded of this as I anticipate this month’s Federal Reserve (Fed) meeting. A cut is widely expected — but what is the level that markets need, versus what they want?

Continued

Comments Off on Waiting for a rate cut: How much is too much?

Invesco Global Bond Fund: The first three years


July 9, 2019
Subject | Active management | Invesco

Invesco Global Bond Fund crossed its three-anniversary with strong returns, finishing in the top quartile of its peer group.1 The management team navigated choppy waters with a changing mix of assets to capture upside in good times while providing protection in more challenging periods. The use of corporate credit, mortgage back securities and emerging markets helped to generate returns in calm markets, while a significant allocation to global government bonds helped to provide ballast during times of volatility.

Continued

Comments Off on Invesco Global Bond Fund: The first three years

ECB worries have receded, but Fed policy doubts have some pundits on the defensive


July 8, 2019
Subject | Invesco | Macro views

I spent the past week in Knoxville, Tennessee, watching my daughter’s basketball team play in a national tournament. I am the unofficial scorekeeper of the team, which makes the experience even more interesting, as I track the games on a variety of metrics. What I found is that the risks to my daughter’s team were different in each game, depending on the abilities of the opposing team. It reminded me that various market environments present different risks and, just as quickly as one game ends and a new game against a different team begins, so too can environments change.

Continued

Comments Off on ECB worries have receded, but Fed policy doubts have some pundits on the defensive

Navigating the low interest rate environment


July 3, 2019
Subject | Invesco | Macro views

The most recent monetary policy meetings from the Federal Reserve (Fed) and European Central Bank (ECB) laid the ground work for a new round of interest rate cuts and potential quantitative easing (QE) in Europe. This comes as global central banks are trying to get in front of softening economic data and disappointing inflation measures.

Continued

Comments Off on Navigating the low interest rate environment
Algorithm Wars

The U.S. cycle breaks a record. So now what?


July 2, 2019
Subject | Invesco | Macro views

Kristina: As of July 1, the U.S. business cycle has set a new record for longevity. It’s a significant milestone, to be sure, but what does it really mean for investors? The answer might not be what you think. To help put this cycle into context, I’m turning over this edition of Weekly Market Compass to my colleague Brian Levitt, Global Market Strategist for North America.

Continued

Comments Off on The U.S. cycle breaks a record. So now what?

The superiority of Canadian Corporate Credit


June 27, 2019
Subject | Invesco | Macro views

Canadian companies continue to benefit from a strong earnings growth backdrop, especially in domestic facing sectors of the economy. Demand for new bond issuance remains exceptionally strong, highlighted by the recent all-time record number of buyers1 for a 10-year bond issued by Telus Corporation. In a world of a growing stock of negative-yielding debt, demand for high-quality, I believe positive-yielding bonds should continue to be well supported.

Continued

Comments Off on The superiority of Canadian Corporate Credit

Could central banks boost stocks in the second half?


June 24, 2019
Subject | Invesco | Macro views

The Federal Reserve (Fed) met last week and clearly telegraphed that it will no longer be “patient” and that it is leaning toward loosening monetary policy. Why? Fed Chair Jay Powell said trade developments and global growth concerns are on the mind of the central bank. As I look into the second half of the year, those two items are key to my outlook as well – and I believe the willingness of central banks to become more accommodative could be a positive development for stocks.

Continued

Comments Off on Could central banks boost stocks in the second half?

Will the Fed lose its patience this week?


June 17, 2019
Subject | Invesco | Macro views

All eyes will be on this week’s U.S. Federal Reserve (Fed) meeting — especially the statement (whether the central bank will retain its “patient” stance) and the “dot plot” (which charts the outlook for interest rates). The June 18-19 Fed meeting is very important because market expectations have gotten so dovish recently. And with risks rising, many investors recognize that once again the Fed stands between them and a more challenging stock market environment.

Continued

Comments Off on Will the Fed lose its patience this week?

A foundational approach to managing risk


June 12, 2019
Subject | Active management | Invesco

According to Plato’s account of his mentor’s trial, Socrates stated “The unexamined life is not worth living.” I think this is a pretty good motto, so I spent the past nine months reviewing and evaluating my investment process to ensure that I haven’t picked up any bad investment habits.

Continued

Comments Off on A foundational approach to managing risk

Central banks provide a silver lining to the escalating trade war


June 10, 2019
Subject | Invesco | Macro views

A collective sigh of relief was expelled on Friday evening as U.S. President Donald Trump announced he would indefinitely suspend the planned imposition of tariffs on Mexico – which was set to go into effect on June 10. Markets have entered “risk on” mode, given that the crisis was averted. However, we need to recognize that the announcement that the U.S. would apply a tariff on Mexican goods as a way to address immigration was a “game changer.” I believe strongly that just the threat of using tariffs to achieve non-trade policy objectives is very concerning and will likely contribute to a significant escalation in economic policy uncertainty – even though the current situation has been resolved.

Continued

Comments Off on Central banks provide a silver lining to the escalating trade war