Financial Markets
In response to the Chinese stimulus announced in late September, our Emerging Market strategists upgraded EM equities to no more than neutral. Indeed, while these measures have triggered a sentiment-fueled rally from depressed valuation levels, conditions…
According to BCA Research’s Bank Credit Analyst service, CAPEX does not appear to be especially broad-based even among the largest companies in the US. The enclosed chart presents a bottom-up estimate of CAPEX as a percent of sales for the S&P…
The prospects of Fed rate cuts powered the S&P 500 Real Estate index’s rally. Real estate was the best-performing sector in Q3, outperforming the S&P 500 by nearly 12%. Can this sector pursue its lead now that expectations of monetary easing are…
US job openings grew by a larger-than-expected 8.04 million jobs in August from 7.71 million. July’s openings were also revised 38 thousand higher. However, despite the upside surprise, the August hires rate fell to 3.3% and July’s hires were revised…
The Nifty Fifty bull market of the early seventies was a mania in which investors got carried away chasing after a subset of prized growth stocks. While we do not think the Magnificent Seven stocks are in a bubble, they do have some parallels with the growth stars of 50 years ago.
Preliminary estimates suggested that US durable goods orders stagnated in August after having surged 9.9% m/m in July, and beating expectations they would decline. Excluding the volatile transportation component, however, durable goods grew a robust 0.5%. …
US financial conditions have become noticeably easier since August. The Fed has embarked on its easing cycle with a bang, sending equities higher and spreads lower, while the trade-weighted dollar gave back more than half of its year-to-date gains. The…
September’s Chinese PMIs were uninspiring. The Caixin manufacturing PMI dipped into contraction territory (50.4 to 49.3) despite expectations it would modestly improve. The alternative NBS manufacturing PMI improved from 49.1 to 49.8, above expectations,…
After resisting the consensus narrative in 2022 that a US recession was imminent, and then predicting an immaculate disinflation for 2023, the Global Investment Strategy team has joined the dark side and is now expecting a recession to start in the US within the next six months. Accordingly, we recommend that investors underweight stocks and overweight government bonds.
US nominal personal income growth decelerated to a 0.2% pace in August, from 0.3% in July, missing expectations that it would accelerate. Nominal personal spending also disappointed, growing at a slower 0.2% pace from 0.5%. In real terms, spending barely…