Sales and earning growth expectations for energy stocks are still pretty awful for the next fiscal year (FY1). Sales are expected to drop by 17% and earnings by a whopping -29%. However, earnings are expected to make a V-shaped rebound.
Read MoreAfter two years of devaluation, the Japanese Yen is quite undervalued by our work. In the first chart below, we show the JP Morgan broad and narrow Japanese Yen relative to long-term trendlines. By these measures, the yen is around 25% below the 25 year average.
Read MoreEven though US stocks as gauged by the S&P 500 are near their all-time highs, trends under the surface are deteriorating ever so slightly. In Europe and especially in the Pacific, however, the opposite is happening. Below we show three charts per MSCI developed market region showing various measures of breadth and momentum.
Read MoreWe noted yesterday that the US stock market took off after the Fed statement released (and the 2-10 year part of the yield curve came in significantly). So after the dust settles, which sectors led and which sectors lagged after the Fed statement?
Read MoreIf past relationships between the survey conducted by Credit Suisse and ZEW to determine economic expectations in Switzerland hold, the outlook is not very bright. From retail sales to unemployment to GDP, history would suggest a rough patch ahead.
Read MoreWhether this is pre-FOMC jitters or something else we will soon find out, but the action in copper recently and especially so far this morning is not sending such a reflationary signal.
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Since euro QE began in earnest at the beginning of March it seems we’ve heard nothing but the positive merits of investing in Europe now that the central bank has finally stepped up to the plate and delivered long overdue unconventional monetary stimulus.
Read MoreIndia has for years battled high levels of inflation which has in many ways kept the country from realizing its full economic potential. Over the last year though, basically since the price of oil stopped going up, Indian inflation has remained tame.
Read MoreWith the falling Euro and the recent launch of QE in Europe, European equity markets have come into the spotlight for many investors. Today, we wanted to take a look at European equity valuations in an absolute sense as well as on a relative basis to its developed market peers.
Read MoreOn March 4th we wrote in The Dollar Is Breaking Out Again And What It Means For Stocks that ”for a variety of cyclical and structural reasons…stocks in North America tend to be the relative beneficiary of USD strength while stocks in other regions generally, but not always, tend to underperform.
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Surprising as it may seem, only 12% of stocks in the MSCI World Index trade for less than 1x book value. This is compared to more than 30% in 2012 and nearly 50% in 2009. How the times have changed!
Read MoreThe recent (more than 10% QoQ) slide in the euro is a two-standard deviation event, the likes of which we have not seen since 2010. And, as we can see in the chart above, the only time the euro has declined more versus the USD was back in 2008.
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MSCI World equities are off to a rough start for the month, with 8 out of 10 sectors in negative territory so far: The percentage of stocks above their respective moving averages has fallen: And the number of stocks making new lows has jumped to 33% from 0% for longer time horizons: Whether this pullback
Read MoreIt’s no secret that we think stocks are expensive. Indeed, over the last few months we’ve written extensively about what we think are high valuations for stocks everywhere.
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The ICE US dollar index looks to have broken out of what has been a rather short-lived consolidation after the massive move since the middle of 2014. If this is in fact the start of another round of dollar strength, then stock investors should carefully consider where in the world to deploy cash into stocks.
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