The document summarizes the current state of the US economy and financial markets. It notes that most economic indicators point to a weak economy, with GDP growth collapsing in the fourth quarter. Fear and uncertainty in the markets have declined from their peaks but are still elevated. The author argues that in the short term, stimulus measures and increased certainty around political events will help reduce fear and support a stock market rally. Medium term, markets should return to fundamentals and valuation. Long term, inflation may rise again and further squeeze consumers, though recovery will be slow.
Howard Marks provides a balanced discussion of the current market environment, covering both positives and negatives. On the positive side, the U.S. economy is growing and corporate profits are increasing. However, asset valuations are very high by historical standards and investor behavior has become increasingly risky. Given the high prices and uncertainties, Marks favors a cautious stance rather than aggressiveness. While not recommending getting out of the market, he advocates incorporating more defensiveness into portfolio management strategies.
The document summarizes recent negative economic news and market declines in the US. It reported that housing prices, manufacturing activity, consumer confidence, and unemployment all weakened in recent months. The stock market declined for five straight weeks in response. However, some analysts believe this is just a temporary slowdown and not the start of a double-dip recession, citing factors like low interest rates and corporate profits. The document advocates for optimism about US innovation and future economic growth.
The document provides a third quarter 2010 market review from Rothschild Asset Management. It summarizes that after a sharp selloff in August, stock markets rebounded in September with the S&P 500 returning 11.3% for the quarter. The review discusses investors oscillating between optimism and pessimism in response to economic news. It expresses a view that the economic recovery will be subpar as consumers reduce debt and increase savings. The review also notes an expectation that the Federal Reserve will take additional monetary action to support the economy.
- The document discusses the recent volatility in global stock markets and the fear that has gripped investors. While there are valid economic concerns, fear has become contagious and may be overstating the risks.
- The US economy has held up better than expected so far in 2016, with steady job growth and consumer spending. However, tightening financial conditions have led to declines in stock valuations.
- Central banks are again trying to ease financial conditions through further monetary stimulus in order to support the economy and stabilize markets, though investor faith in their actions may be waning.
The portfolio manager provides a summary of key events from 2013, noting that fears over issues like the fiscal cliff, Fed tapering, and government shutdowns did not materialize as severely as predicted by media. Overall markets performed well despite issues. Looking ahead, the portfolio will maintain bullish exposure according to its tactical model and focus on high-quality dividend stocks in both Canada and the US. While Canada underperformed the past three years, signs suggest it may start outperforming the US in 2014.
Annie Williams Real Estate Market Trends Aug/Sep 2013Jon Weaver
The document summarizes local real estate market trends in San Francisco. It reports that median condo prices rose 10.3% month-over-month and 24.6% year-over-year in July. Condo sales were down 26.3% from June but up 18.9% year-over-year. Single-family home sales were up 19.9% year-over-year in July, while the median price dipped 7.3% from June but rose 17.3% from the previous July. Mortgage closing costs have increased 6% over the past year due to low rates bringing more refinancing and new regulations. Foreclosure activity remained low with one notice of default and sale filed
Mortgage Closing Costs Rising - The Real Estate Report August/SeptemberAMSI, San Francisco
The Real Estate Report August/September, local market trends San Francisco: "Mortgage Closing Costs Rising" by AMSI's Real Estate Broker Robb Fleischer
Howard Marks provides a balanced discussion of the current market environment, covering both positives and negatives. On the positive side, the U.S. economy is growing and corporate profits are increasing. However, asset valuations are very high by historical standards and investor behavior has become increasingly risky. Given the high prices and uncertainties, Marks favors a cautious stance rather than aggressiveness. While not recommending getting out of the market, he advocates incorporating more defensiveness into portfolio management strategies.
The document summarizes recent negative economic news and market declines in the US. It reported that housing prices, manufacturing activity, consumer confidence, and unemployment all weakened in recent months. The stock market declined for five straight weeks in response. However, some analysts believe this is just a temporary slowdown and not the start of a double-dip recession, citing factors like low interest rates and corporate profits. The document advocates for optimism about US innovation and future economic growth.
The document provides a third quarter 2010 market review from Rothschild Asset Management. It summarizes that after a sharp selloff in August, stock markets rebounded in September with the S&P 500 returning 11.3% for the quarter. The review discusses investors oscillating between optimism and pessimism in response to economic news. It expresses a view that the economic recovery will be subpar as consumers reduce debt and increase savings. The review also notes an expectation that the Federal Reserve will take additional monetary action to support the economy.
- The document discusses the recent volatility in global stock markets and the fear that has gripped investors. While there are valid economic concerns, fear has become contagious and may be overstating the risks.
- The US economy has held up better than expected so far in 2016, with steady job growth and consumer spending. However, tightening financial conditions have led to declines in stock valuations.
- Central banks are again trying to ease financial conditions through further monetary stimulus in order to support the economy and stabilize markets, though investor faith in their actions may be waning.
The portfolio manager provides a summary of key events from 2013, noting that fears over issues like the fiscal cliff, Fed tapering, and government shutdowns did not materialize as severely as predicted by media. Overall markets performed well despite issues. Looking ahead, the portfolio will maintain bullish exposure according to its tactical model and focus on high-quality dividend stocks in both Canada and the US. While Canada underperformed the past three years, signs suggest it may start outperforming the US in 2014.
Annie Williams Real Estate Market Trends Aug/Sep 2013Jon Weaver
The document summarizes local real estate market trends in San Francisco. It reports that median condo prices rose 10.3% month-over-month and 24.6% year-over-year in July. Condo sales were down 26.3% from June but up 18.9% year-over-year. Single-family home sales were up 19.9% year-over-year in July, while the median price dipped 7.3% from June but rose 17.3% from the previous July. Mortgage closing costs have increased 6% over the past year due to low rates bringing more refinancing and new regulations. Foreclosure activity remained low with one notice of default and sale filed
Mortgage Closing Costs Rising - The Real Estate Report August/SeptemberAMSI, San Francisco
The Real Estate Report August/September, local market trends San Francisco: "Mortgage Closing Costs Rising" by AMSI's Real Estate Broker Robb Fleischer
« Market Perspectives » est notre revue mensuelle des marchés. Elle présente de la façon la plus synthétique possible :
- notre analyse des principaux faits marquants et indicateurs macro susceptibles de dessiner les marchés sur le mois.
- notre vision sur les différentes classes d’actifs
Cette revue sera continument enrichie avec nos indicateurs quantitatifs.
La plupart de nos analyses sont disponibles sur www.finlightresearch.com
Our monthly publication “Market Perspectives” presents a synthetic view of all the asset classes we cover.
The report is composed of six sections covering Macro, Equities, FI & credit, FX, Commodities and Alternatives.
Each section is preceded by a summary of our views on the related asset class.
Most of our publications are available on our web site www.finlightresearch.com
« Market Perspectives » est notre revue mensuelle des marchés. Elle présente de la façon la plus synthétique possible :
- notre analyse des principaux faits marquants et indicateurs macro susceptibles de dessiner les marchés sur le mois.
- notre vision sur les différentes classes d’actifs
Cette revue sera continument enrichie avec nos indicateurs quantitatifs.
La plupart de nos analyses sont disponibles sur www.finlightresearch.com
Our monthly publication “Market Perspectives” presents a synthetic view of all the asset classes we cover.
The report is composed of six sections covering Macro, Equities, FI & credit, FX, Commodities and Alternatives.
Each section is preceded by a summary of our views on the related asset class.
Most of our publications are available on our web site www.finlightresearch.com
OXBOW ADVISORS APRIL 2017 MARKET COMMENTSKeys Oakley
The stock market’s movement in 2016 was most Unusual, Unpredictable, and downright Crazy compared to previous years. Between politics and economics, it was a classic case study of extremes...
This document provides a summary and analysis of current economic and market conditions:
1) Corporate profits in the US have declined significantly in the past two quarters, dropping profits to 2006 levels and reducing profit margins from unprecedented highs.
2) Stock market valuations by several measures, including price-to-earnings ratios and corporate sector value to market capitalization, are at very rich levels seen only during the tech bubble, suggesting low future returns.
3) Central bank policies have kept interest rates low and driven investment into stocks, but this is masking weaker underlying corporate earnings. As monetary policies normalize, stock markets may face challenges.
In the marketing world we spend so much time looking for trends and data to explain the world and consumer behavior. But it seems like we often overlook the biggest trend of all - the macro economic cycle.
What if this one cycle is the macro-trend that explains changes in brand value, changes in innovation, and changes in customer values?
Higher growth, higher risk, slightly higher returns
We expect a lack of investment opportunities to remain an enduring challenge for
investors in 2017. We think this despite the fact that economic growth will likely pick
up in 2017 vs the somewhat disappointing performance in 2016. Indeed, over the
past several months, the growth rate of global GDP already appears to be realizing at
the top of the 3%-3½% range that has prevailed throughout the past five years. The
main reason is the swing in the financial conditions impulse from sharply negative to
modestly positive, both in the US and in parts of the emerging world. And the fiscal
stimulus that will likely be enacted by the new Trump administration, and in other
advanced economies, will only reinforce the inflation pressures already in place. With
output and employment already close to potential, the rising inflation pressure
strengthens our conviction that the Federal Reserve will likely raise the funds rate in
December and again three more times during 2017 (“A catalyst for tighter Fed
policy“, Global Economics Analyst, 16 Nov 2016).
Stronger cyclical growth in the US will probably not do much for asset markets
except help shift the narrative from ‘low-flation’ and monetary accommodation to
reflation and rising rates. But this will not change the fact that the trend growth rate
of GDP appears to have fallen for both advanced and emerging economies during
the post-crisis period. Meanwhile, valuation levels for equities and especially bonds
remain highly elevated by historical standards, so expected returns appear to be low
across most asset classes. In fixed income, yield is scarce, and in equities, growth is
scarce. So investors have been pushed into less familiar strategies, such as equity
investors reaching for yield in high-dividend, low-vol stocks, or bond investors lining
up to own the growth risk inherent in the long-duration bonds of tech companies.
The document discusses the potential economic and market impacts of rising protectionism in major economies like the US. It suggests markets are currently optimistic about growth due to expected fiscal stimulus, but are ignoring risks from increasing political distrust and potential trade conflicts. The impacts of protectionism could be more complex than in the 1930s due to stronger global economic links, and may initially stimulate growth but eventually lead to stagflation as retaliation offsets gains. Central banks would be unable to control inflation in this scenario and interest rates would remain low for longer.
The group of Tej Patel, Preet Patel, and Hillary Khan comprised portfolio group TPH with the goal of earning an 8% return by diversifying across different industries. While their original goal was not met due to market downturns, their portfolio outperformed the S&P 500 and other student groups with a 3.26% return. Major holdings included Apple and Google, though they lost money on Google when it declined along with broader market drops in late October and November. The group's analysis found their portfolio had diversified systematic risk but they did not anticipate the market shifts related to the elections.
The investment duo of Mark and Michele bravely tackle the popular Investment Myths head on.
Need to know if a trading myth is true or false? Call the Investment Mythbusters! Inspired by the popular TV series with a surprisingly similar name, Vunani Private Clients' Investment Managers Mark Weetman and Michele Santangelo have devoted themselves to combining elements of science, statistics, investment theory and some good old-fashioned luck to determine if popular investment beliefs are true or false.
The document summarizes several common investment myths, including that the performance of January predicts the performance of the full year, that the "Santa Claus rally" in December reliably occurs, that the S&P 500 performs best on Tuesdays, that copper prices can predict the economy, and that markets should be sold in May and avoided over the summer. For each myth, the document analyzes historical data and finds little statistical evidence to reliably support the strategies predicted by the myths.
This document is a quarterly letter from GMO discussing potential investment environments and their implications. It presents two potential scenarios - "Purgatory" where interest rates rise gradually from very low levels, and "Hell" where rates remain near zero forever.
Under the "Hell" scenario of permanently low rates, traditional stock and bond allocations would still be reasonable investments. However, expected returns would be lower across all assets. Under the "Purgatory" scenario, current valuations would need to fall as rates rise, so returns over the next 7 years would be worse than in "Hell" though better over the long-run. The appropriate portfolio depends on the scenario, with lower allocations to stocks and bonds in
RealtyTrac's January 2015 Housing News Report has some great information to kick off the new year.
Highlights Include:
“Five Economists Forecast the 2015 Housing Market,” by Housing News Report Staff
“A Slightly More Optimistic Outlook for Homebuilding,” by Mark Vitner, Wells Fargo
“Chicago: A Tale of Two Cities,” by Octavio Nuiry, Managing Editor
“House of Outrageous Fortune,” by Michael Gross, reviewed By Octavio Nuiry, Managing Editor
Top 20: Foreclosure Rates in the Nation's 20 Largest Metros in December 2014
he world is changing and we have to learn to adjust to new technologies. The markets have been viewed as volatile.....where were you during the highly volatile tech rally at the turn of the century. Let us remind you that during those years,trading haults were triggered frequently. Today, we have nothing like that to deal with. Hummm guess volatile is a relative term.
- The document provides the monthly viewpoint from the Chief Investment Officer of ACPI Investments Ltd. discussing various investment topics and market outlook.
- It notes that while markets have rallied on hopes for pro-business policies under Trump, controversial statements threaten his agenda and markets may be overly optimistic given implementation risks and timelines.
- The global economy appears to be in a new investment cycle, but it is unclear if this will translate to sustained reflation or just a temporary boost. Central banks are beginning to tighten policies as growth improves.
- Social Security payments will increase by $2 per $1,000 next year, but Medicare part B costs will increase by $27.20, leaving seniors with less money. The cost of living increase does not cover the rise in Medicare costs.
- A French colleague expressed concerns about "scary" conditions in France like a large influx of immigrants and poor economic prospects, reflecting growing populism in Europe over issues like immigration and jobs. These populist sentiments have also fueled movements like Brexit and Donald Trump's campaign.
- In the Friday session following the Brexit vote, the S&P 500 fell 1.9% and closed below a support level, while the Nasdaq fell 2% and came close
Trump continues to be a driver of market sentimentHantec Markets
Traders that have been getting worked up by the impact of "risk on, risk off" are now having to get used to this morphing into "Trump on, Trump off" (as dreadful as this sounds). You even have some expanding this with "Trumpflation" and "Donald down", but this will be the final time you hear these terrible terms on these pages. Anyway, Donald Trump continues to have a significant impact on market sentiment across financials with forex and commodities especially driving off moves on Treasury yields and the dollar. With a light economic calendar this is likely to continue this week.
Americans feel financially strained due to stagnant wages and rising costs of living over the past 40 years. While automation has eliminated some jobs, a larger issue is a skills gap as the culture pushes more people into white-collar jobs instead of trades with strong demand. Technology will likely continue disrupting jobs but widespread social problems from unemployment are decades away.
President Trump's election victory surprised markets. Interest rates rose sharply in response as markets anticipated less regulation, lower taxes, and stronger economic growth under Trump. However, nearly all forecasts predict more modest GDP growth of around 2.3% in 2017 rather than the 4% growth suggested by Trump. The future remains uncertain as Trump frequently tweets and singles out companies. Interest rates may soften in the first quarter but end the year only modestly higher than the start of 2017.
BlackRock: 2014 Outlook The List - What to Know, What to DoEcon Matters
The document provides a mid-year update on the 2014 outlook for various asset classes and investment themes. It notes that stocks have outperformed bonds so far in 2014 and are on pace for mid to upper single digit returns by year-end. It maintains the views that economic growth will continue improving but remain below trend, and that interest rates will trend upward modestly in the second half of the year. Key investment themes to seek growth while managing volatility, find income but don't overreach, and rethink bonds also remain intact.
« Market Perspectives » est notre revue mensuelle des marchés. Elle présente de la façon la plus synthétique possible :
- notre analyse des principaux faits marquants et indicateurs macro susceptibles de dessiner les marchés sur le mois.
- notre vision sur les différentes classes d’actifs
Cette revue sera continument enrichie avec nos indicateurs quantitatifs.
La plupart de nos analyses sont disponibles sur www.finlightresearch.com
Our monthly publication “Market Perspectives” presents a synthetic view of all the asset classes we cover.
The report is composed of six sections covering Macro, Equities, FI & credit, FX, Commodities and Alternatives.
Each section is preceded by a summary of our views on the related asset class.
Most of our publications are available on our web site www.finlightresearch.com
« Market Perspectives » est notre revue mensuelle des marchés. Elle présente de la façon la plus synthétique possible :
- notre analyse des principaux faits marquants et indicateurs macro susceptibles de dessiner les marchés sur le mois.
- notre vision sur les différentes classes d’actifs
Cette revue sera continument enrichie avec nos indicateurs quantitatifs.
La plupart de nos analyses sont disponibles sur www.finlightresearch.com
Our monthly publication “Market Perspectives” presents a synthetic view of all the asset classes we cover.
The report is composed of six sections covering Macro, Equities, FI & credit, FX, Commodities and Alternatives.
Each section is preceded by a summary of our views on the related asset class.
Most of our publications are available on our web site www.finlightresearch.com
OXBOW ADVISORS APRIL 2017 MARKET COMMENTSKeys Oakley
The stock market’s movement in 2016 was most Unusual, Unpredictable, and downright Crazy compared to previous years. Between politics and economics, it was a classic case study of extremes...
This document provides a summary and analysis of current economic and market conditions:
1) Corporate profits in the US have declined significantly in the past two quarters, dropping profits to 2006 levels and reducing profit margins from unprecedented highs.
2) Stock market valuations by several measures, including price-to-earnings ratios and corporate sector value to market capitalization, are at very rich levels seen only during the tech bubble, suggesting low future returns.
3) Central bank policies have kept interest rates low and driven investment into stocks, but this is masking weaker underlying corporate earnings. As monetary policies normalize, stock markets may face challenges.
In the marketing world we spend so much time looking for trends and data to explain the world and consumer behavior. But it seems like we often overlook the biggest trend of all - the macro economic cycle.
What if this one cycle is the macro-trend that explains changes in brand value, changes in innovation, and changes in customer values?
Higher growth, higher risk, slightly higher returns
We expect a lack of investment opportunities to remain an enduring challenge for
investors in 2017. We think this despite the fact that economic growth will likely pick
up in 2017 vs the somewhat disappointing performance in 2016. Indeed, over the
past several months, the growth rate of global GDP already appears to be realizing at
the top of the 3%-3½% range that has prevailed throughout the past five years. The
main reason is the swing in the financial conditions impulse from sharply negative to
modestly positive, both in the US and in parts of the emerging world. And the fiscal
stimulus that will likely be enacted by the new Trump administration, and in other
advanced economies, will only reinforce the inflation pressures already in place. With
output and employment already close to potential, the rising inflation pressure
strengthens our conviction that the Federal Reserve will likely raise the funds rate in
December and again three more times during 2017 (“A catalyst for tighter Fed
policy“, Global Economics Analyst, 16 Nov 2016).
Stronger cyclical growth in the US will probably not do much for asset markets
except help shift the narrative from ‘low-flation’ and monetary accommodation to
reflation and rising rates. But this will not change the fact that the trend growth rate
of GDP appears to have fallen for both advanced and emerging economies during
the post-crisis period. Meanwhile, valuation levels for equities and especially bonds
remain highly elevated by historical standards, so expected returns appear to be low
across most asset classes. In fixed income, yield is scarce, and in equities, growth is
scarce. So investors have been pushed into less familiar strategies, such as equity
investors reaching for yield in high-dividend, low-vol stocks, or bond investors lining
up to own the growth risk inherent in the long-duration bonds of tech companies.
The document discusses the potential economic and market impacts of rising protectionism in major economies like the US. It suggests markets are currently optimistic about growth due to expected fiscal stimulus, but are ignoring risks from increasing political distrust and potential trade conflicts. The impacts of protectionism could be more complex than in the 1930s due to stronger global economic links, and may initially stimulate growth but eventually lead to stagflation as retaliation offsets gains. Central banks would be unable to control inflation in this scenario and interest rates would remain low for longer.
The group of Tej Patel, Preet Patel, and Hillary Khan comprised portfolio group TPH with the goal of earning an 8% return by diversifying across different industries. While their original goal was not met due to market downturns, their portfolio outperformed the S&P 500 and other student groups with a 3.26% return. Major holdings included Apple and Google, though they lost money on Google when it declined along with broader market drops in late October and November. The group's analysis found their portfolio had diversified systematic risk but they did not anticipate the market shifts related to the elections.
The investment duo of Mark and Michele bravely tackle the popular Investment Myths head on.
Need to know if a trading myth is true or false? Call the Investment Mythbusters! Inspired by the popular TV series with a surprisingly similar name, Vunani Private Clients' Investment Managers Mark Weetman and Michele Santangelo have devoted themselves to combining elements of science, statistics, investment theory and some good old-fashioned luck to determine if popular investment beliefs are true or false.
The document summarizes several common investment myths, including that the performance of January predicts the performance of the full year, that the "Santa Claus rally" in December reliably occurs, that the S&P 500 performs best on Tuesdays, that copper prices can predict the economy, and that markets should be sold in May and avoided over the summer. For each myth, the document analyzes historical data and finds little statistical evidence to reliably support the strategies predicted by the myths.
This document is a quarterly letter from GMO discussing potential investment environments and their implications. It presents two potential scenarios - "Purgatory" where interest rates rise gradually from very low levels, and "Hell" where rates remain near zero forever.
Under the "Hell" scenario of permanently low rates, traditional stock and bond allocations would still be reasonable investments. However, expected returns would be lower across all assets. Under the "Purgatory" scenario, current valuations would need to fall as rates rise, so returns over the next 7 years would be worse than in "Hell" though better over the long-run. The appropriate portfolio depends on the scenario, with lower allocations to stocks and bonds in
RealtyTrac's January 2015 Housing News Report has some great information to kick off the new year.
Highlights Include:
“Five Economists Forecast the 2015 Housing Market,” by Housing News Report Staff
“A Slightly More Optimistic Outlook for Homebuilding,” by Mark Vitner, Wells Fargo
“Chicago: A Tale of Two Cities,” by Octavio Nuiry, Managing Editor
“House of Outrageous Fortune,” by Michael Gross, reviewed By Octavio Nuiry, Managing Editor
Top 20: Foreclosure Rates in the Nation's 20 Largest Metros in December 2014
he world is changing and we have to learn to adjust to new technologies. The markets have been viewed as volatile.....where were you during the highly volatile tech rally at the turn of the century. Let us remind you that during those years,trading haults were triggered frequently. Today, we have nothing like that to deal with. Hummm guess volatile is a relative term.
- The document provides the monthly viewpoint from the Chief Investment Officer of ACPI Investments Ltd. discussing various investment topics and market outlook.
- It notes that while markets have rallied on hopes for pro-business policies under Trump, controversial statements threaten his agenda and markets may be overly optimistic given implementation risks and timelines.
- The global economy appears to be in a new investment cycle, but it is unclear if this will translate to sustained reflation or just a temporary boost. Central banks are beginning to tighten policies as growth improves.
- Social Security payments will increase by $2 per $1,000 next year, but Medicare part B costs will increase by $27.20, leaving seniors with less money. The cost of living increase does not cover the rise in Medicare costs.
- A French colleague expressed concerns about "scary" conditions in France like a large influx of immigrants and poor economic prospects, reflecting growing populism in Europe over issues like immigration and jobs. These populist sentiments have also fueled movements like Brexit and Donald Trump's campaign.
- In the Friday session following the Brexit vote, the S&P 500 fell 1.9% and closed below a support level, while the Nasdaq fell 2% and came close
Trump continues to be a driver of market sentimentHantec Markets
Traders that have been getting worked up by the impact of "risk on, risk off" are now having to get used to this morphing into "Trump on, Trump off" (as dreadful as this sounds). You even have some expanding this with "Trumpflation" and "Donald down", but this will be the final time you hear these terrible terms on these pages. Anyway, Donald Trump continues to have a significant impact on market sentiment across financials with forex and commodities especially driving off moves on Treasury yields and the dollar. With a light economic calendar this is likely to continue this week.
Americans feel financially strained due to stagnant wages and rising costs of living over the past 40 years. While automation has eliminated some jobs, a larger issue is a skills gap as the culture pushes more people into white-collar jobs instead of trades with strong demand. Technology will likely continue disrupting jobs but widespread social problems from unemployment are decades away.
President Trump's election victory surprised markets. Interest rates rose sharply in response as markets anticipated less regulation, lower taxes, and stronger economic growth under Trump. However, nearly all forecasts predict more modest GDP growth of around 2.3% in 2017 rather than the 4% growth suggested by Trump. The future remains uncertain as Trump frequently tweets and singles out companies. Interest rates may soften in the first quarter but end the year only modestly higher than the start of 2017.
BlackRock: 2014 Outlook The List - What to Know, What to DoEcon Matters
The document provides a mid-year update on the 2014 outlook for various asset classes and investment themes. It notes that stocks have outperformed bonds so far in 2014 and are on pace for mid to upper single digit returns by year-end. It maintains the views that economic growth will continue improving but remain below trend, and that interest rates will trend upward modestly in the second half of the year. Key investment themes to seek growth while managing volatility, find income but don't overreach, and rethink bonds also remain intact.
« Market Perspectives » est notre revue mensuelle des marchés. Elle présente de la façon la plus synthétique possible :
- notre analyse des principaux faits marquants et indicateurs macro susceptibles de dessiner les marchés sur le mois.
- notre vision sur les différentes classes d’actifs
Cette revue sera continument enrichie avec nos indicateurs quantitatifs.
La plupart de nos analyses sont disponibles sur www.finlightresearch.com
Our monthly publication “Market Perspectives” presents a synthetic view of all the asset classes we cover.
The report is composed of six sections covering Macro, Equities, FI & credit, FX, Commodities and Alternatives.
Each section is preceded by a summary of our views on the related asset class.
Most of our publications are available on our web site www.finlightresearch.com
« Market Perspectives » est notre revue mensuelle des marchés. Elle présente de la façon la plus synthétique possible :
- notre analyse des principaux faits marquants et indicateurs macro susceptibles de dessiner les marchés sur le mois.
- notre vision sur les différentes classes d’actifs
Cette revue sera continument enrichie avec nos indicateurs quantitatifs.
La plupart de nos analyses sont disponibles sur www.finlightresearch.com
Our monthly publication “Market Perspectives” presents a synthetic view of all the asset classes we cover.
The report is composed of six sections covering Macro, Equities, FI & credit, FX, Commodities and Alternatives.
Each section is preceded by a summary of our views on the related asset class.
Most of our publications are available on our web site www.finlightresearch.com
Trade dispute and the US consumer are key this weekHantec Markets
The outlook for Fed rate hikes has shifted as the trade dispute has begun to bite. However, is this a move that has gone too far as the US pulls back from tariffs on Mexico. The US consumer indicators could be key. We consider the outlook on forex, equities and commodities.
1) The document discusses volatility, interest rates, and taxes based on a note from Frank Pape, Director of Consulting at Russell Investments.
2) Volatility has been low recently but may pick up again as concerns arise. Low interest rates have helped the US economy but rates are expected to gradually rise starting in mid-2015.
3) Taxes can significantly reduce long-term returns through tax drag. Being tax-aware and using strategies like tax-loss harvesting can help minimize taxes and improve after-tax returns.
The document provides a comprehensive review and outlook of the US economy across several areas including demographics, markets, real estate, employment, and GDP. It summarizes key data and trends in each area, with some of the main points being that demographics will weigh on consumption as baby boomers retire, the housing market still faces significant headwinds from high inventory and foreclosures, unemployment remains at historically high levels across many sectors, and GDP growth is expected to be positive in the short term but a return to recession is still possible given weak underlying fundamentals.
« Market Perspectives » est notre revue mensuelle des marchés. Elle présente de la façon la plus synthétique possible :
- notre analyse des principaux faits marquants et indicateurs macro susceptibles de dessiner les marchés sur le mois.
- notre vision sur les différentes classes d’actifs
Cette revue sera continument enrichie avec nos indicateurs quantitatifs.
La plupart de nos analyses sont disponibles sur www.finlightresearch.com
Our monthly publication “Market Perspectives” presents a synthetic view of all the asset classes we cover.
The report is composed of six sections covering Macro, Equities, FI & credit, FX, Commodities and Alternatives.
Each section is preceded by a summary of our views on the related asset class.
Most of our publications are available on our web site www.finlightresearch.com
1. The portfolio manager discusses the market performance in Q2 2014, with the Canadian equity markets outperforming other global regions.
2. He explains that central bank monetary policies, particularly from the US Federal Reserve and European Central Bank, have been a key driver for the stock market rally over the past few years by keeping interest rates low.
3. The portfolio manager reiterates his advice to investors to stick to their customized plans and not be deterred by short-term market fluctuations, as the plans are designed to navigate periods of volatility.
- Markets rallied on news of a US debt deal and strong earnings from Google. Stocks like Google and Priceline rose to new highs.
- With the debt deal delaying any tapering of QE by the Fed until next year, and a weaker dollar, stocks are positioned to continue moving higher in the near future.
- Various economic indicators like industrial metals and emerging markets have also shown signs of strength, further supporting an upward trajectory for stocks.
The document provides an economic outlook report for September 2010 by Mike Lathigee, Chairman and CEO of Alliance Investment Solutions. The summary is:
1) The economy is experiencing extreme uncertainty and it is difficult to determine if it is improving or declining. Cash flow from conservative, low-risk investments is the focus.
2) Real estate appreciation is not expected in the near future. Cash flow from real estate is recommended over appreciation-based investments.
3) The stock market uncertainty is due to mixed economic indicators like high unemployment and weak corporate earnings. Government bonds have increased in demand despite low returns.
4) Emerging markets are seeing strong growth while most developed economies are growing slower than the US
Get your popcorn here for the big debate on television tomorrow. The market is not doing much, maybe the debating wizards will give it a reason to move, one way or the other.
Global Insight-Wake Me Up When September BeginsDavid Apted
The document provides an overview and analysis of recent developments in global fixed income markets from an investment perspective. It discusses:
1) Low volatility in US Treasury markets with yields holding in a tight range, and the rise in negative-yielding global debt nearing $9 trillion, weighing on Treasuries.
2) Upcoming central bank meetings at Jackson Hole, the ECB, and Fed which may provide opportunities for investors if they cause yields to move.
3) The document recommends a focus on quality corporate bonds in the 5-7 year part of the yield curve for European investors.
« Market Perspectives » est notre revue mensuelle des marchés. Elle présente de la façon la plus synthétique possible :
- notre analyse des principaux faits marquants et indicateurs macro susceptibles de dessiner les marchés sur le mois.
- notre vision sur les différentes classes d’actifs
Cette revue sera continument enrichie avec nos indicateurs quantitatifs.
La plupart de nos analyses sont disponibles sur www.finlightresearch.com
Our monthly publication “Market Perspectives” presents a synthetic view of all the asset classes we cover.
The report is composed of six sections covering Macro, Equities, FI & credit, FX, Commodities and Alternatives.
Each section is preceded by a summary of our views on the related asset class.
Most of our publications are available on our web site www.finlightresearch.com
The dollar and US Treasury yields remain key Hantec Markets
In the final week before Christmas, the US dollar may have started with a minor corrective move, however the medium to longer term outlook seems to be well set now for ongoing dollar strength, with US Treasury yields a significant driving force. We look at the key factors to consider for forex markets, equities and commodities ahead of the New Year.
The basic message from the study is that when the market has declined in the months of January and February, the rest of the year has been choppy and volatile.
Signs of an impending stock market crashSwapnilRege2
Stock Markets Greed Fear market Pyschology Sotck market Fluctuations Signs of Stock market reaching the top Initial signs of bear market beginning Market fluctuations
The document provides an analysis of global markets and the economy from FinLight Research. Key points include:
1) The US election uncertainty is over but markets are still digesting implications of Trump's victory. Earnings had been improving but higher wages could weigh on margins.
2) The global economy appears to be improving but investors should avoid complacency given uncertainty. The focus is on 3Q earnings season, rising wages, expected inflation, and volatile volatility.
3) Macroeconomic indicators show mixed signals with strong employment/income but weak industrial production. Systemic risks include high Chinese debt and a potential hard Brexit.
4) Equity valuations remain high and earnings growth is needed for further gains.
Finlight Research - Market Perspectives - Nov 2016
JDMR Overview 02-02-09
1. ECONOMY AND MARKETS – Clearly all signs these days are that economic growth
has come to a screeching halt. ISM, both Manufacturing and non-manufacturing, have
finally shown a slight bounce after hitting all-time lows in November but most economic
numbers including GDP, Housing starts, and Consumer Confidence still point to an
extremely weak overall economic picture.
ISM Manufacturing Composite
ISM Non-Manufacturing Composite
Q/Q GDP Growth
2. GDP growth collapsed in 4Q, falling 3.8% over 3Q. At this time last year, I argued that
whether we were in a recession, heading for recession, or on track to brush with
recession, the trend was clearly for slower economic growth and higher unemployment. I
predicted that this would no doubt lead to lower eps estimates and multiple contraction
which of course leads to lower stock prices. Now I make the argument that “worst case”
or at least a “really bad case” scenario is being assumed and stocks may have priced in
that assumption.
Fear and uncertainty are still relatively high. The VIX at the moment is registering in the
high 40’s after touching 90 just a few months ago. A far cry for the complacent readings
below 20 we saw around this time last year. Although it spiked again recently, it should
continue to fall back below its 200 day MA (approximately 36).
One Year VIX Chart
At the moment, we have a better grasp on things than we did just a few months ago.
Although things could no doubt get worse, it seems that some fear and uncertainty have
abated. Most likely, going forward, for better or worse, the resolution of many issues that
have plagued the market will begin to take shape. I acknowledge that things may get
worse before they get better but as the cloud of uncertainty lifts, we should have a better
idea of which direction we are headed, along with what actions the Fed, Treasury, and
new President, may have to take and the fear will further dissipate. Lower fear translates
to higher stock prices and as we have seen since late November, stocks have trended
higher.
COMMODITIES – All commodity futures curves are clearly in contango in both the
medium and long-term at the moment.
4. Corn futures thru 2012
The carry trade is now alive and well, once again leading suppliers to build inventories.
The replenishing of inventories will result in more demand in the short-term. For
example, refineries began to sell-off inventories when prices were at sky-high levels.
Now they look to replenish them at lower levels. They will continue to build until the
spot price plus the cost of carry approaches future prices. We will most likely see the
return of inflation concerns in the coming months. Likewise, Energy and Commodity
stocks should be one of the earliest sectors to recover.
POLITICS – For better or for worse, the political cloud of uncertainty that hung over the
markets in 2008 has at least been lifted. We now know who our President is and how he
might approach things going forward based on his recent action. Since the election,
Obama has continued to preach doom and gloom. Although it may be having a negative
impact on Consumer Confidence, he continues to put pressure on Congress, the Fed, the
Treasury, etc. to take emergency action through multiple stimulus plans.
In my opinion, Obama seems to be watching the markets with one eye somewhat
concerned about how his actions are received. Combined with the financial bailout and
an easing Fed, the likelihood of a deep recession or depression seems unlikely at this
point. We should see credit spreads come in as uncertainty and fear abates. Libor has
fallen to about 1.25% from close to 5% where it was for the mid-Oct meltdown.
5. LIBOR 1 year Chart
Again, how the Obama administration acts in the first few months may or may not be
exactly what the market wants to hear. However, the Obama has been quite visible and
vocal with pro-market and pro-stimulus comments that should go along way to reducing
fear and uncertainty which will eventually lead to a return to fundamentals.
Baltic Dry Index
The un-freezing of the credit markets have helped shipping rates recover a bit. The Baltic
Dry Index fell 94% in the late-summer and Fall 2008 before its recent recovery. It has
risen from a low of 663 on 12/4/08 to its current reading of 1070 or roughly 61%
STOCKS – As I mentioned, there has been a disconnect from market fundamentals for
the last few months. Valuations are meaningless in a world where panic and fear rule the
day. Think about it, what good is a PE ratio when the E is rapidly falling and could be
negative for several quarters? Last year at this time, GS traded at $220 or slightly below
10x the forward eps estimate of approximately $23. The argument was made by several
analysts that the stock was “cheap” because historically it trades in a PE range from 8-
15x next years’ eps. By mid-August, estimates were sliced to about $15.50 and yet the
6. PE was still about 10. It fell to 47 before its recent bounce! The 2009 estimate is about
$10.90 meaning the stock now trades at about 7x next years (2009) eps estimate. Is it
now “super cheap” or is there another 70% downside from here? Is it a buy or sell? Is
next years eps estimate even remotely reliable (especially when we don’t know how large
the “one-time” right-offs could be)?
The truth is… top-down and technical analysis are much more important at the
moment than traditional fundamental analysis. Anyone that understood the impact
that a credit crisis could have on a firm like GS that’s leveraged many, many times its
shareholders equity would have realized that eps would be much lower in 2008 most
likely. Hindsight is 20/20 of course but my point is that most traders have little or no
faith in valuations and fundamentals at the moment.
My view is that most traders are in “show me” mode. They want to see an upturn before
they call a bottom. We’ve had several upturns and re-tests over the past few months and
at the moment we have had a sharp sell-off.
Typically, a close above the 200 day MA would represent a “show me” signal. In fact, if
we do bounce from here we could get back to the 200 day MA in a hurry. In 1990 (a
comparable time-period in many ways), the S&P 500 peaked and then broke through the
200 day MA in mid-July. It continued downward before bottoming in mid-Oct. It then
raced up over 15% to touch its 200 day by the first week in Dec.
1990 Bear Market
In July 1998 (in the wake of the LT Capital meltdown), the market again peaked before
declining 22% and bottoming in early Oct. Then in just 10 trading days, it recovered
over 15% before hitting its 200 day MA.
7. 1998 Bear Market
Finally, in the most recent Bear market case, back in 2000, the S&P broke below its 200
day MA in Sept and fell 35% before bottoming a few days after Sept 11 2001, more than
1 year later. Then, by the first week in Dec, it again shot up close to 25% to touch its
moving average.
2000 – 2001 Bear Market
At current levels (01/30 close of 825 on the S&P 500) a move to 200 day MA (1250)
would represent a gain of over 35%. The question of course is do you wait for a 35%
move before taking action or is the potential move worth the risk, even if we haven’t put
in a bottom yet?
8. Current Bear Market
CONCLUSION - In the short-term, there are numerous indicators pointing toward the
formation of a bull rally. Liquidity provided to the markets through fiscal and monetary
stimulus will go a long way to quell fear amongst traders. Lower fear, as measured by
the VIX, correlates well with higher stock prices. Uncertainty revolving around political
events will no doubt be closer to resolution in the coming weeks which again lowers fear
levels. Heightened awareness to the economic and financial crisis’ by Obama, Congress,
and Fed officials will most likely lead to fiscal and monetary stimulus policies that will
help us avoid a 1930’s style depression. Taking that into consideration, I also look at my
favorite short-term indicator, which is sentiment. Most Bull/Bear surveys are close to 2
to 1, Bears vs. Bulls. Ned Davis Research reports a 39% Bulls in its latest sentiment
survey. This is up slightly from a 32% reading near the Oct 9 lows which was below the
35% reading at the 2002 low. Other contrarian indicators such as Demark and
Advance/Decline line (see separate note) also suggest a short-term over-sold condition.
Medium-term, the market should return to fundamentals. At that time valuation and
other traditional metrics will be more useful and give us a better sense of direction. Last
year at this time, Wall Street’s estimates for 2008 eps on the S&P 500 still looked for
close to double digit growth. Most estimates were in the $80-82 range. Using the 2007
year-end closing price, the forward PE was about 18. Now estimates have come down to
reflect a more realistic 4-5% growth rate. Assuming flat growth over this years estimate
gives us an estimate of $75.50 for 2009, suggesting a forward PE under 11. (Current
consensus estimates of $85 would give us a PE of about 9.5 but I think estimates need to
come down from 12-13% growth to low single digits at best.) A PE of 11 represents the
lower end of the historical range suggesting at current levels a argument for a “cheap”
market can be made. A return to fundamentals will most likely result in a continued
rally.
Long-term (3-6 months out) the crystal ball is still foggy. The flood of liquidity being
dumped on the market will no doubt be inflationary. We should see energy and food
prices begin to rise again and further squeeze the consumer. The dollar should again
retreat unless the Fed takes a hawkish stance and sharply raises rates at the first signs of
9. recovery, which is unlikely in my opinion. It took a while to break the US consumer, but
a taste of sky-high energy prices, the shutting down of the home ATM, and the very real
threat of job losses has finally scared them silly. Consumer confidence will take a while
to recover. I would expect to see further decline in consumer spending in 2009. It will
be a long and painful recovery for most retail names. I’ll go into more detail in my next
report where I’ll go over each individual sector and suggest several trade ideas to position
for the coming weeks and months.
-Jeff McKeown