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Zacks Analyst Blog Highlights: Blackstone, Bank of Nova Scotia and Carlyle Group

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Chicago, IL – December 21, 2021 – announces the list of stocks featured on the Analysts Blog. Every day, Zacks Equity Research analysts discuss the latest news and events impacting stocks and financial markets. Stocks recently featured in the blog include: Blackstone Inc. BX, The Bank of Nova Scotia BNS and The Carlyle Group Inc. CG

Here are highlights from Monday’s analyst blog:

Merry Christmas: Coming World Week

At the end of this Global Week Ahead, the main world stock markets are enjoying a long Christmas break.

Most central banks have already completed their last meetings for this year. Their collective decisions (taken last week) have raised questions for traders to think about during the holidays.

A bit of fresh US macro data may shed some light on how consumers are resisting, given soaring product prices and the highly transferable Omicron variant.

Here are Reuters’ last five global market themes for 2021, revamped for equity traders.

(1) Where have the big central banks left us?

With December’s deluge of central bank meetings over and dusted off, markets can sail through the end of the year, right?

Not enough. The Bank of England, for its part, left investors puzzled for the second time in six weeks, as a surprise rate hike again raised questions about its style of communication.

The European Central Bank, in the spirit of Christmas perhaps, has given everyone something – ending emergency measures next year applauds the hawks, go for an existing asset purchase program for an indefinite period makes doves happy. The rise in peripheral bond yields suggests some unease over the easing of support.

And by upping the outlook for rate hikes, the Federal Reserve appears to have set the agenda for a tumultuous 2022 as central bankers chart their way out, albeit at dramatically different paces.

(2) Watch the macro data for signs of vacation spending around the world

It’s shopping season, but how gleeful are American buyers about soaring prices and Omicron?

The indices are expected to come from the December US Consumer Confidence Index on Wednesday and November new home sales, consumer spending and durable goods orders on Thursday.

Consumer prices in the United States rose at their fastest pace in about four decades in November. Any sign that the rising cost of living and pandemic fatigue is weighing on spending – which accounts for more than two-thirds of U.S. economic activity – will not make a comfortable reading for the Fed.

After all, the central bank has just doubled the pace at which it will cut bond purchases and has signaled up to three rate hikes for 2022.

(3) Time for a new British Prime Minister?

Two years after British Prime Minister Boris Johnson’s party swept the election, his tenure is shaky.

A revolt of 100 lawmakers, scandals, the loss of a parliamentary seat his party had dominated for 200 years, and a stammered economy mean bookmakers are even offering money to be replaced in 2022. A majority of voters think he should resign, a poll found.

Already, Brexit had capped Britain’s post-pandemic rebound. Now an Omicron “tidal wave” (in Johnson’s words) means more trouble. Private sector growth plunged in December to its lowest level in 10 months, according to PMIs, but inflation of more than 5% could force the Bank of England to raise several rates next year.

On December 22, final third quarter GDP readings could confirm that the UK economy is lagging behind its G7 peers. Unsurprisingly, UK stocks’ 35% discount to their global peers hasn’t stopped investors from voting with their feet.

(4) Chile has chosen a new president

Chileans went to the polls on Sunday, ending a year full of political risks in Latin America – a region already haunted by income inequality, volatile rulers, disappointing growth and a disproportionate COVID-19 toll.

The second round of elections in Chile pitted ultra-conservative José Antonio Kast against former left-wing student leader Gabrial Boric. With 99.95% of the vote in his pocket, the 35-year-old Boric won easily by 55.87% to 44.13%. It was the first presidential decision since the world’s largest copper producer was rocked by protests two years ago.

The cycle of regional elections continues in 2022.

Colombia is due to hold congressional elections in March and a presidential ballot in May.

Brazil’s general vote in October will dominate investor attention, given the country’s economic weight in the region. So far, former left-wing leader Luiz Inacio Lula de Silva has a comfortable lead in the polls.

(5) How does China fit into a new year?

Investors are trying to figure out what China’s top leaders meant when they recently said next year will be all about economic stability and prudent monetary policy.

The likes of JPMorgan peg growth estimate about 5%, close to what government advisers recommend. Perhaps the policy will be adapted to fit the goal of “common prosperity” before the 20th National Congress of the Communist Party next year.

But the bond markets are confused. The central bank injected liquidity into the banks while trying to control a strong yuan. Yet expectations of a cut in its main operating money market rate this week have turned out to be in vain.

Beijing’s stability and deleveraging targets could mean banks’ credit benchmarks won’t change next week either.

Zacks # 1 Top Stocks (Strong Buy)

Let’s look at stocks in the financial sector:

(1) Black stone: It is a $ 123 stock with a market cap of $ 85 billion. I see a Zacks Value score of F, a Zacks Growth score of C, and a Zacks Momentum score of C.

(2) The Bank of Nova Scotia: It’s a $ 67 stock with a market cap of $ 82.7 billion. I see a Zacks Value score of D, a Zacks Growth score of F, and a Zacks Momentum score of D.

(3) The Carlyle group: It’s a $ 52 stock, with a market cap of $ 18.4 billion. I see a Zacks Value score of D, a Zacks Growth score of D, and a Zacks Momentum score of F.

Thinking of buying financials, after hawkish news from the Fed, BoE and ECB?

Considering the zero scores of Zacks Value, here you are behind.

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