It has certainly been a good couple of weeks for financial stocks. But the good times still haven’t been good enough to bring bank stocks out of last place among 24 developed market industry groups.
Since the introduction of the National Income and Product Accounts (NIPA) in 1946, the US has experienced 11 recessions.
As U.S. equity markets continue to forge new highs, we take a look at our strong and weak close indicators to gauge investors’ conviction levels in the latest moves.
Listen, before we go through a litany of economic charts that pour some cold water on the recent bout of optimism regarding US economic growth prospects we want to stress that we don’t believe economic growth is about to fall off of a cliff.
Preliminary data from Markit’s Purchasing Managers’ Index (PMI) survey, released today, convey an overall positive picture for the Eurozone as a whole.
Chief Investment Officer Steven Vannelli, CFA, hosted a conference call to share the investment team’s analysis of the global equity and fixed income markets one week after the election.
Regardless of the series you use, the USD seems to have broken out of a 20-month trading range and is trading at the highest level in well over a decade.
More than one out of five developed market stocks and more than two out of five emerging market stocks are in a bear market (down over 20% from a high) in the past 200 days.
We all know that stocks are a leading indicator of economic growth and disappointingly recent breadth measures suggest that economic activity may slow over the next several months.
Back in September we explained how US treasury yields were at parity with foreign government bonds for many foreign investors (namely euro and yen-based investors) from a currency hedged basis.
General consensus seems to have quickly moved to a view that a Trump administration is going to be inflationary for the US and the global economy.
Investors love to toss around fundamental data points that are pretty meaningless without context.
Brazil’s trade data in October was abysmal. Exports fell 10.2% year-over-year to $13.721 billion and imports fell 15% year-over-year to $11.375 billion.
Regular readers are aware of our research showing that the Knowledge Effect is really a “super factor”.
October was a pretty good month, all things considered, for economic data out of Europe. Industrial production out of Germany, Italy, France and for the Euro-Area aggregate all surprised to the upside.
Neither the bulls nor the bears are winning the equity market battle right now. When markets have strong momentum, either positive or negative, than you tend to see big spikes in 20-days highs (when positive) and lows (when negative). Currently, we see neither.
Since the summer of 2015 the long gold, long 10-year US treasury trade bonds has basically been one in the same (silver and treasury bonds have moved in tandem as well).
A primary concern of central bankers is that in a deflationary environment consumers change their expectations regrading the future level of prices.
This quarter we discuss our work navigating a global equity rotation from defensive-driven leadership to cyclical-driven leadership.
High yield investors have had a much different experience in 2016 than they did in 2015 (fortunately for them). The high yield spread over 10-year treasury yield blew out from 375 bps in June 2015 to 844 bps in February 2016.
There seems to be several compelling reasons at the moment to mine developed market Asia for new equity investment ideas.
Today’s CPI release by U.K.’s statistical service prompted more than a few versions of the following chart, insinuating that the precipitous drop in the GBP is going to drive prices sharply higher.
We all know that the Fed has committed to keeping its balance sheet extraordinary large for as long as they feel the weak economy justifies this accommodating position.
5-year, 5-year forward breakeven inflation has historically been in a range between 2-3%. However, over the past year year future inflation expectations have fallen below 2% for the first time since the financial crisis and have bounce around between 1.40% and 2%.
The August JOLTS release was a pretty big disappointment. Expectations were for 5.8 million job openings while the actual data came in at 5.44 million.
We have said before that the most important US employment stat each month is the index of aggregate weekly hours worked. The good news for September is that we saw an improvement in the year-over-year rate of change from 1.05% to 1.63%.
The shale revolution in the US energy sector has flipped US trade data on its head.
The forex market has been relatively calm over the past couple of months. The Gavekal Capital FX Volatility Index has declined since early August and is now at a level that is slightly under the average volatility level since 1980.
China’s role in keeping the global economy from falling into a more severe recession, or even a depression, during the financial crisis is probably greatly underappreciated.
Certainly, no one is implying that the U.K.’s economic situation is anywhere near as precarious as that of Greece. We just wanted to point out a peculiar oddity of which we were not previously aware, whatever the investment implications may be.