TORONTO, ONTARIO — (Marketwire) — 08/25/12 — With the world keeping a close eye on Europe and the United States for signs of stability and growth, BMO Harris Private Banking-s latest notes that while the economy continues to right itself the situation continues to influence business and consumer sentiment.
Highlights from the report include:
The Eurozone
The first half of the summer saw good news and bad news in Europe:
“Policymakers have the will and ability to resolve the Eurozone situation and avoid systematic damage to financial systems, but only time will tell how their efforts will unfold,” said Paul Taylor, CIO, Fundamental Equities, BMO Asset Management Inc. and Investment Strategist for BMO Harris Private Banking
The U.S.
Mixed economic data emerged from the U.S.:
“While Q2 economic data was unambiguously weak, stronger economic data has emerged at the start of the third quarter in 2012,” said Mr. Taylor.
North American Equity Markets
North American equity markets remained volatile as global challenges continue to put pressure on the economy and policymakers:
“We believe Canadian equities will continue to be relatively inexpensive and will generate moderate returns over the next 12 months, with both the economy and corporate earnings continuing to grow modestly,” noted Mr. Taylor.
BMO Harris Private Banking Investment Strategy
Mr. Taylor suggested investors should consider a portfolio that puts a slightly greater allocation to equities than to bonds and cash. He also recommended a greater allocation to Canadian and U.S. stocks than to non-North American equity markets.
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