Mackenzie's 2024 report highlights strong US GDP growth, Canada’s rate cuts, and key investment themes
Mackenzie Investments' reveals report highlights key financial market trends, projecting strong global GDP growth driven by the US, with Canada facing economic challenges due to higher interest rates.
Mackenzie has unveiled its 2024 Mid-Year Market Outlook, offering financial advisors and investors crucial insights into market trends and economic forecasts for the remainder of the year.
The report indicates robust global GDP growth in the first half of 2024, largely due to the US However, Canada’s economy lags, influenced by its sensitivity to elevated interest rates.
Consequently, the Bank of Canada (BoC) is expected to lower interest rates in the latter half of 2024, potentially more aggressively than the US Federal Reserve, to stimulate growth.
Despite persistent inflation and rising bond yields, equities have shown resilience, supported by positive earnings outlooks and economic conditions.
“The global GDP growth trajectory, propelled by robust US performance, underscores the resilience of the world's largest economy,” stated Lesley Marks, CIO of Equities at Mackenzie Investments.
Key Themes for 2024
1. Corporate and Sustainable Debt
Fixed income markets have experienced upward adjustments in bond yields, reflecting strong corporate fundamentals. The report suggests attractive opportunities in high-quality corporate bonds and sustainable debt options driven by energy transition financing needs.
Steve Locke, CIO of Fixed Income and Multi-Asset Strategies at Mackenzie, highlights the potential for favorable yields in the corporate bond market.
2. Energy Transition
Investment in cleaner energy continues to surpass fossil fuels, presenting opportunities across various sectors. The report also notes the strain on global electricity systems due to the AI revolution, emphasizing the importance of sustainable infrastructure investments.
3. Innovation and AI
AI’s transformative potential remains a significant investment avenue. Investors are urged to strategize carefully to capitalize on AI opportunities, extending beyond major technology companies to include hardware and service sectors supporting AI development.
