😎 Summer Sale Exclusive - Up to 50% off AI-powered stock picks by InvestingProCLAIM SALE

Why Brookfield Stock Rose 1% on Monday?

Published 2024-03-13, 01:32 a/m
© Reuters.  Why Brookfield Stock Rose 1% on Monday?

Kalkine Media - In the midst of a broader stock market downturn, Brookfield (TSX: BN) stock managed to post a surprising gain on Monday, outperforming major North American indices. Let's delve into some possible reasons behind this unexpected uptick, considering the performance of TSX financial stocks.

  • Value Investing Trend:
  • Brookfield's (TSX:BN) outperformance can be attributed in part to a favorable day for value stocks in general. The Dow Jones Industrial Average and TSX Composite Index, both heavily weighted towards value stocks, saw gains, indicating a broader trend favoring value-oriented investments. Given Brookfield's status as a value stock, this trend likely contributed to its positive performance.

  • Expectations of Interest Rate Cuts:
  • Anticipation of interest rate cuts may have also buoyed Brookfield's stock. Despite being a Canadian company, Brookfield's investments and debts are predominantly in the United States, with a significant portion borrowed in U.S. dollars. The company faced challenges in 2022 and 2023 due to rising interest rates, which increased its interest expenses, particularly on variable rate debt. However, with inflation in the U.S. on a downward trend and expectations of Federal Reserve rate cuts, there's optimism that Brookfield's interest expenses may decrease in the next quarter, potentially boosting its earnings and stock price.

  • Strong Fundraising Results:
  • Brookfield's recent success in fundraising also contributed to its positive momentum. In December, the company raised an impressive $28 billion for a closed-end fund, setting a target of $150 billion in funds raised over the next year. The influx of funds not only enhances Brookfield's fee income but also underscores investor confidence in the company's ability to generate returns. As Brookfield Asset Management (TSX:BAM)'s fee income rises, a significant portion is expected to flow through to Brookfield Corp, further bolstering investor optimism.


    Despite concerns surrounding its debt levels and sensitivity to interest rates, Brookfield's performance in 2024 has been promising. With substantial funds raised in 2023 and a favorable macroeconomic environment characterized by declining inflation, the company appears well-positioned to capitalize on investment opportunities. While challenges may persist, particularly regarding interest rate fluctuations, the overall outlook for Brookfield remains positive, signaling potential growth and returns for investors.

    Read more on Kalkine Media

    Latest comments

    Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
    Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
    Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
    It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
    Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
    © 2007-2024 - Fusion Media Limited. All Rights Reserved.