Skip to main content

The Globe and Mail

BMO starting to see shift out of equities

Bank of Montreal's Canadian private bank is starting to see investors shift money out of stocks amid mounting concern related to Europe's debt crisis and a global economic slowdown.

Funds had flowed into equities this year until about six weeks ago, Paul Taylor, who oversees about $14-billion in assets as chief investment officer of BMO Harris Private Banking, said today on a conference call with reporters.

Stocks worldwide have tumbled since late July as Greece edged closer to defaulting on its debt, threatening to topple some of Europe's biggest banks and weaken the global financial system. The U.S.'s credit rating was cut in August, and signals pointed to slowing economic growth in the U.S. and China, the world's two largest economies.

Story continues below advertisement

"The retail investor has been like a deer caught in the headlights of an 18-wheeler, and they have been moving money back to cash most recently," Mr. Taylor said.

Declining stock prices have made valuations appealing for investors who can wait years for a recovery in case of a U.S. recession or worsening conditions in Europe, Mr. Taylor said.

Gains from equities are likely to outpace those of government bonds in the years ahead, he said. Shares of Canadian financial companies, such as IGM Financial Inc. , are attractive for their solid management and growing dividends, Mr. Taylor said.

Report an error
About the Author
Investment Reporter

Nicolas Johnson has covered global finance, markets and investing since 1998. He joined The Globe and Mail in 2011. He has worked as a reporter and editor with Bloomberg News in Paris and Tokyo, and also worked briefly in emerging-market debt at Société Générale. More

Comments are closed

We have closed comments on this story for legal reasons. For more information on our commenting policies and how our community-based moderation works, please read our Community Guidelines and our Terms and Conditions.

Combined Shape Created with Sketch.

Combined Shape Created with Sketch.

Thank you!

You are now subscribed to the newsletter at

You can unsubscribe from this newsletter or Globe promotions at any time by clicking the link at the bottom of the newsletter, or by emailing us at privacy@globeandmail.com.