Canadian financial markets expected to get boost from Federal Budget
TORONTO, ONTARIO and CHICAGO, ILLINOIS--(Marketwire - March 30, 2012) - In a media conference call held today, BMO Financial Group's experts Paul Taylor and Andrew Busch provided their insights into the outlook for Canadian and U.S. equities and global currency markets.
Paul Taylor, Chief Investment Officer, Fundamental Equities, BMO Asset management and Chief Investment Officer, BMO Harris Private Banking
- Markets are reacting positively to the Federal Budget due to the focus on spending restraint and further measures to reach a balanced budget
- S&P/TSX index (Canada) expected to rise 9 per cent in 2012
- S&P 500 index (U.S.) expected to increase 11 per cent in 2012
- While energy stocks are up less than one per cent, there is more value in the sector given better demand, an improving global economic recovery and supply constraints
- Continued strength in Technology sector, which is broader than the "Apple" effect. Consumer electronics demand is on the rise with product innovations including smartphones, tablets and notebooks
- Canadian dollar unlikely to strengthen relative to the US dollar in 2012
Andrew Busch, Global Currency and Public Policy Strategist, BMO Capital Markets
- There will be downside pressure on currencies, including Brazil, Australia, and New Zealand that have exports linked to China, which is expected to have slower growth this year
- The Euro will hold in a trading range of 1.30-1.35 until late summer
- The Japanese yen will continue to lose value and head towards 90.0 by year end as the Bank of Japan monetizes the government debt of Japan.
- The Federal Reserve will maintain a policy to keep U.S. treasury securities yields low and prices high.
Transcript and MP3 recording of the panel is available. Please contact the BMO Media Relations hotline at (416) 867-4873 for more information.