Central Banks Change Direction - Earnings: NTR, BCE, BPF, KEG, Preferred Shares
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Rumors of slowing earnings growth in 2019, combined with lack of inflation, are chipping away at the US Central Bank's case for raising interest rates. All their talk about raising rates 4 times a year is ending. It's what comes next for interest rate policy that matters. This has yet to be communicated and understood by markets. Given the outlook for slowing 2019 earnings, included with 2018 year end reports, markets will need to hear reassurances from central banks. What markets will prefer to hear is the focus of this week's comments.
Earnings reports include Nutrien Inc. (NTR-TSX, NYSE), BCE Inc.(TSX, NYSE), Boston Pizza Royalty Income Fund(BPF.UN) and The Keg Royalties Income Fund. Preferred share price changes were on average higher by 0.7% for both the fixed and variable rate preferred shares. Prices for the better credit quality preferred share names, both fixed and variable are expected to stabilize, based on our outlook for interest rates. This is one of the few places investors can earn regular income in the 5-6% range with reasonable security of capital.
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