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Financial Markets

EM Small Caps Bucking the Trend
US, European and Japanese small caps have underperformed their large cap counterparts by 22.6%, 15.3% and 10.1% respectively since 2021. They now face conflicting forces. On the one hand, they are extremely beaten down and cheap, potentially offering a good…
Daily Insights
Is Everybody Really Bullish Bonds?
Treasurys have sold off substantially since the beginning of the year – the result of stickier-than-anticipated inflation and the repricing of Fed interest rate expectations. Some commentators have warned that there is scope for this selloff to continue amid…
Daily Insights
Lingering Inflation Is Bullish For Energy Stocks
According to BCA Research’s US Equity Strategy service, rising inflation benefits Utilities, Energy, and Materials, and is a headwind for the Consumer Discretionary sector. After a protracted bout of underperformance, the Energy sector has rebounded …
Daily Insights
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Gold And Bitcoin Joined At The Hip

Gold and bitcoin are conceptually joined at the hip because the value of both comes from their ‘non-confiscatability’ by inflation, by bank failure, and in the case of bitcoin, by state expropriation. The sharp recent rallies in both gold and bitcoin reflect that the market has suddenly upped the value of non-confiscatability, and a plausible explanation is that recent US inflation data show that the journey to sustained 2 percent inflation has stalled, raising the risk that the Fed might balk at finishing the journey. Plus: JPM, CL, and USD/CHF are tactical reversal candidates.

Counterpoint by Dhaval Joshi
Increased Share of S&P 500 Companies Issuing Negative Q1 Guidance
Some of the biggest US banks will kick off the reporting season in earnest this Friday, leading increased market focus on Q1 2024 earnings. According to Factset, analysts expect S&P 500 year-over-year earnings growth to expand for the third straight…
Daily Insights
Minimum Volatility Equities
Investors typically associate high-flying tech stocks with high sensitivity to interest rates. The rationale is simple: Given that most of their cashflows are further into the future, their value will be more sensitive to changes in their discounter. And…
Daily Insights
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Recap Of Investment Themes

Fears of a hard landing are abating as growth has been surprising to the upside. New worries are emerging, such as the trajectory of disinflation, and the pace and timing of rate cuts. In this environment, it is important to build a resilient all-weather portfolio, which protects against a correction, rising rates, or stubborn inflation but also has exposure to the AI theme.

US Equity Strategy by Irene Tunkel
Are Oil Equities Cyclical?
Traditionally, equity managers have thought of oil equities as cyclical. This is because, in the past, oil equities had a strong positive correlation to the overall market. But US oil equities have increasingly become more defensive. Their 36-month rolling…
Daily Insights
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Listening To Europe’s Credit Impulse

Europe credit flows are stabilizing, hence a major drag on the region’s growth will dissipate. What does this development imply for European equities?

European Investment Strategy by Mathieu Savary
Bitcoin Speculative Shorts Are Not What They Seem
Short speculative positions on Bitcoin at the CME are near theie highest level on record. Some financial commentators have suggested that this bearish positioning in bitcoin could act as kindle and spark a short squeeze. But looking at raw speculative…
Daily Insights

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