TSX:BPO.PR.A - Post by User
Post by
Carenaon Aug 02, 2024 5:16pm
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Post# 36162013
Today
TodayHi there,
What a wild day......here are my tid bits:
(i) Great to see the BPO prefs hang in there today and essentially outperform the market.
(ii) It seems clear to me at this point that the recent resurgence in all the Brookfield group stocks was all about a pending tanking of the US 10 yr yield. The entire Brookfield empire is interest rate sensitive. I know our BPO prefs are deeply impacted by the Cdn 5 yr, but I think lower rates underpin the BPO prefs $25 par value in the long term.
(iii) The North American markets are still up nicely for the year....however, something that resonated with me today is a BofA note this morning that said if there is an economic slowdown coming, then interest rates have to come WAY DOWN to stimulate as government deficit spending is tapped out and thus don't expect much fiscal stimulus. A very good point.
(iv) I own about 70 securities in my portfolio and lots were down 3-5% today but I do take solace in having stuck with the various utiltiies and pipelines. BCE, RCI, Telus, ZWU, TRP, ENB, FTS, EMA and many others were solidly green today.
(v) I think this storm had been brewing for awhile. I personally only ever thought it only made sense to lower rates if there was an economic slowdown or recession coming. The market is all of a sudden acting like this is going to be the reality.
In the big picture, I think the market needed this reset and this is all healthy. Again, I really have no conviction where we are going, but I am sitting tight and staying very long BPO prefs.
Have a great long weekend,
Carena