Energy

Millions of Texans were without power this week when the state was hit with a record setting winter storm. An overhaul of its aging infrastructure would require massive amounts of metals and other materials, which would be positive for miners and producers.

The Emerging Markets (EM) asset class is often labelled a commodity play for investment purposes. The argument is simple and directional; EM countries export commodities, so rising commodity prices are good for the asset class, whereas falling commodity prices hurt EM countries.

Despite questions over financing the European Union’s (EU’s) new Green Deal, the green transition is now under way.

Happy Year of the Ox! Today China and a number of other Asian countries celebrate the Lunar New Year, also known as the Spring Festival.

Rob Arnott: “There hasn’t been a better time to be a value investor at any other time in my career. I look back at the tech bubble and I never thought I would see valuations stretched the way they were then. We're back to that, and then some." We invite you to revisit “Reports of Value’s Death Have Been Greatly Exaggerated” now published in the Financial Analysts Journal.

Tesla announced in a public filing Monday that it bought $1.5 billion worth of Bitcoin as part of a corporate policy that allows the electric vehicle (EV) maker to invest in “alternative reserve assets,” including not just cryptocurrencies but also gold bullion and gold ETFs.

Rick Rieder and team think that today’s potent policy cocktail holds important implications for the path of economic growth, markets and the value of a dollar.

It’s hoped that an extra $1,400 in the pockets of everyday Americans may help support lagging U.S. consumption. We believe the stimulus, along with improved vaccine roll out, may also help support commercial air travel.

Today I want to discuss an arcane-sounding but incredibly important term you need to know: Yield Curve Control. Several central banks are already using it and I see a strong possibility the Fed will join them. But first we must again consider the Gripping Hand.

With the previous week’s short-squeeze headlines behind us, investors remained optimistic about a fiscal support package, which passed the Senate by a vote of 51-50, with Vice President Harris breaking the tie.

We’ll touch on several bases today. We start with the latest news from the Commerce Department which just released its initial estimate of 4Q economic growth (or lack thereof). 2020 goes down as the worst economic year since the end of World War II.

Massive growth in central bank balance sheets via quantitative easing, debt monetization, and firing of “big bazooka” stimulus packages brings renewed focus to potential shocks in the business cycle. An awareness of the macroeconomic “shocks” and their impact on asset prices should be incorporated in investors’ tactical asset-allocation decisions.

When investors talk about “the stock market” they are most often referring to an index that tracks stocks only in their home country. This “home bias” is evident when it comes to the make-up of investors’ stock portfolios. Investors around the world tend to hold mostly domestic stocks.

February begins with a stack of important economic scorecards. Among them are the last of the fourth-quarter corporate earnings reports, last week’s assessment of the 2020 gross domestic product (GDP), unemployment figures, consumer spending, as well as all the other regular reports that give us a snapshot of our recent economic history.

Those of you with kids and grandkids may at some point have stepped inside a GameStop. If so, you might be familiar with the video game retailer’s tagline: “Power to the players.”

Senior Credit Research Analyst Ryan McGrail explains why he believes President Biden's early orders will have a limited near-term impact on oil producers and production.

Precious metals in general did very well in 2020, and I expect them to keep pace in 2021, supported by heightened efforts in the U.S. and elsewhere to transition from fossil fuels to renewable energy.

As a review of the year that was, today’s report analyzes and dissects the nature of the K-shaped recovery in both the economy and stock market.

In the years since the end of the gold standard, there’s been a significant lack of discipline in government spending. Today, the federal debt is closing in on an astronomical $28 trillion, which is more than 130% of the size of the U.S. economy.

What goes up must come down... but does what goes down have to come up? According to the laws of gravity, no. As for commodity markets, however, history tells us it is true.

The newly inaugurated President and Vice President of the United States are proposing much that will have significance for advisors interested in ESG and impact investing.

Despite some news reports that suggest the green ambitions of the US Democratic Party could spell doom and gloom for traditional oil and gas companies.

Our outlook for 2021 is formed by the need to get away from the crowd and to expect some very stormy weather in the U.S. stock market. We are not afraid of drowning. Therefore, we will review the circumstances at the bottom of the market in 2009 with today’s market to see where the crowd is and where we need to go to avoid the coming storm.

Judging by recent phone calls and email queries, inflation is a serious concern among investors this year.

Founding Father Benjamin Franklin said it best: “They who can give up essential liberty to obtain a little temporary safety deserve neither liberty nor safety.” In this light, what are we to make of Trump’s social media suspension?

This week investors learned of president-elect Joe Biden’s initial bid for the next round of covid-19 relief. The number came in at $1.9tn. Importantly, included in this figure is mainly covid relief as opposed to a longer-term fiscal package that will be heavily weighted to infrastructure.

The sage advice to “know what you are investing in” is being dangerously overlooked by both novice and seasoned investors when it comes to bitcoin. A former bitcoin miner explains why the price of BTC is nearly certainly a bubble and likely manipulated. Investors should proceed with extreme caution.

Economic snapback to fuel global growth. We have a very optimistic outlook for 2021, with above-consensus GDP calls around the globe.

The Loomis Sayles Emerging Markets Debt Sector Team shares their views on corporate spreads, foreign exchange and leverage in 2021.

What can investors expect this year? Positive (but unsteady) economic growth, a powerful boost in earnings and continued success for information technology stocks, says Raymond James Chief Investment Officer Larry Adam.

Whereas commodity production had been a major economic driver in emerging markets, we think technology is now the leading force. Semiconductor advancement is the “new oil.” semiconductor companies are so far ahead of their competitors that supply is in fact a constraint—and therefore a major investment consideration.

As we enter 2021, there are two myths told to investors to support the bull market narrative. The first, as we debunked recently, is that low-interest rates justify high valuations. The second is that since valuations are not as high as the “dot.com” crisis, there is no “stock market bubble.”

This should be positive for gold, given the potential for greater government spending and, therefore, inflation.

Emerging-market sovereign debt has rebounded sharply off the lows, but this hard-hit sector offers attractive yields and compelling growth opportunities to discerning investors.

Global carbon pricing is an essential part of any long-term solution to the climate crisis. But advanced economies also need to provide the developing world with highly concessional financing and technical expertise to help it decarbonize – all guided by a World Carbon Bank.

From time to time, readers of the Absolute Return Letter ask for my opinion on this or that and, every now and then, I decide to turn my response into a letter. The last few weeks have been no exception.

Gold and Bitcoin had a very good 2020. Investors, worried about currency debasement from all the money-printing, sought stores of value. Gold surged over 25%, its best year in a decade, while Bitcoin was up more than 300%.

Global utility stocks are typically considered defensive in nature because the dependable reoccurring cash flows they generate make them somewhat bond-like.

Although some on the committee agreed with the market consensus for a moderate continuation of economic growth and equity markets, the majority agreed with a more positive scenario in which the global economy outperforms market consensus, while equities, especially those outside of the US, rally sharply.

How can credit markets help active investors achieve their goals in the present low yield environment? Here are 5 ideas.

With the COVID-19 pandemic spiking again, and with most federal stimulus programs having expired over the last several months, the US poverty rate is soaring at a rate never seen before. Nearly 8 million Americans have fallen into poverty over the last 5 months alone, since the government stimulus programs have largely ended.

Our Head of Equities, Stephen Dover, shares his 2021 equity outlook. He sees opportunity amid upheaval.

The coronavirus pandemic was a once-in-a-lifetime event that transformed society and the economy almost overnight. We believe some of the most significant changes are likely here to stay, and we are focusing our investments on the secular growth trends we expect to strengthen as life returns to normal.

Rick Rieder and team describe how revolutionary changes taking place in corporate business models will impact investing for years.

We were fortunate to watch a recent interview Charlie Munger did with Cal Tech as a distinguished alum. We consider him to be one of the most successful contrarian investment thinkers on the planet. At 96 years of age, he has no fear of being politically incorrect. We contrast this with the mountain of writing, media and rhetoric associated with the topic of climate change.

A nascent global recovery presents both risks and opportunities for fixed income investors. Portfolio Manager Teresa Kong, CFA, discusses why China dominates the universe for EM debt and why Asia may outperform the rest of EM for the foreseeable future.

The holiday shopping season is critical for most retailers. For some, the season is make or break for the whole year. The November retail sales report was weaker than expected, although amplified by the seasonal adjustment. No surprise, consumers are increasingly shopping online.

And then there’s Bitcoin. The world’s biggest cryptocurrency has surged nearly 220% this year, touching an all-time high of $23,717 in intraday trading on Thursday.

As the end of 2020 draws near, many of us are anxious to put this tumultuous year behind us, choosing to look ahead to 2021 in hopes that happier, healthier, and more prosperous times will be had by all.

While COVID-19 rendered many 2020 forecasts obsolete within the first few months of the year, several of BMO Global Asset Management’s key calls proved accurate. Though 2020 was a year of many challenges, we are optimistic for 2021 and expect improved economic conditions and better times ahead.

“This garage is the birthplace of the world’s first high-technology region, Silicon Valley,” the marker reads. It names two Stanford students, William Hewlett and David Packard, who “in 1938 began developing their first product, an audio oscillator, in this garage.”