Daily roundup of research and analysis from The Globe and Mail’s market strategist Scott Barlow
Credit Suisse highlighted the potential for offshore wind power development in Atlantic Canada,
“The Province of Nova Scotia set a 5GW target of offshore wind by 2030 with a plan to support a ‘budding green hydrogen industry’. Nova Scotia Premier Houston, in part, stated ‘…Nova Scotia is open for business and becoming an international leader in offshore wind and green hydrogen development’ (Province Sets Offshore Wind Target). In our view, there is a high degree of potential for large scale offshore wind in parts of Canada – with current focus being across Atlantic Canada as part of local decarbonization efforts, broader regional efforts and, on a longer-term basis, to help underpin energy transition tech like green hydrogen …. Offshore wind in Canada is a nascent industry, but meaningful potential exists – especially for local utility companies, including: Emera Incorporated (EMA) and Fortis Inc. (FTS) for ownership or transmission connectivity (among other things). Some offshore wind exposure in our coverage universe comes from Enbridge Inc. (ENB) and Northland Power Inc. (NPI), however, other renewable stocks are worth noting as are larger energy infrastructure names, including: AQN, BEP, BLX, CPX, INE, RNW and TRP.”
“CS highlights potential for offshore wind power in Atlantic Canada” – (research excerpt) Twitter
***
BMO economist Shelly Kaushik reported on the significant decline in home ownership rates,
“Renting a home has become more common alongside the decline in ownership. Renting households have grown 21.5 per cent vs. an 8.4 per cent increase in owner households over the last decade. That’s led to a higher demand for rental units – about 40 per cent of housing units went to tenants in the five years ending with 2021, the highest proportion since the post-war era. Looking ahead, we already know that monetary tightening is rapidly dampening housing prices. That, combined with rising rents will support conditions for home ownership in the coming years”
“Domestic home ownership rates decline sharply (BMO)” – (research excerpt) Twitter
***
BofA Securities are among the many Wall Street firms re-adjusting their interest rate assumptions in response to an extremely hawkish Federal Reserve,
“in response to the September FOMC meeting, where the median FOMC participant is projecting more near-term rate increases than we had expected, we revise our outlook higher for the target range for the federal funds rate in the current tightening cycle. We now expect the Fed to raise its policy rate by 75bp in November and 50bp in December, followed by two 25bp rate hikes in February and March of next year. This would bring our new forecast for the terminal target range for the funds rate to 4.75- 5.0%. Previously we had anticipated 100bp of hikes after the September FOMC meeting for a terminal rate of 4.0-4.25%. Hence, our revised outlook involves another 75bp of rate hikes relative to our prior baseline forecast.”
***
Diversion: “The world is moving closer to a new cold war fought with authoritarian tech” – M.I.T. Technology Review
Tweet of the Day:
Scott Barlow