BCA Research recently downgraded equities to underweight, citing the likelihood of a U.S. recession due to persistent policy uncertainty and declining consumer sentiment. The firm emphasizes the disruptive effects of current trade policies and related government actions.

Key Findings from BCA Research

• Economic Headwinds: Near-term disruptions and tariff uncertainty are predicted to encourage a recession.
• Declining Consumer Sentiment: Full-year guidance from major retailers points to a tightening of consumer spending.
• Wider Economic Impact: The effects of policy changes go beyond federal employment numbers, which could slow overall economic momentum.
• Asset Allocation Shift: BCA signals a tactical adjustment towards fixed income while lowering equity exposure.

Investors are encouraged to remain vigilant and adapt their strategies in response to these evolving economic landscapes.