The preliminary estimate for corporate profits in the second quarter were released this morning and showed a rebound from the abysmal first quarter profits. Looking at after-tax profits with inventory and capital consumption adjustments, corporate profits 8.4% quarter-over-quarter AR which is the largest gain in three years.
Read MoreWith today’s action in the bond market (30-year treasury yields made new 1-year lows, finishing down 6bps, and 10-year treasury bonds nearly made new 1-year lows, finishing down 4bps), the long end of the yield curve is the flattest it’s been since the fall of 2009, with the 30-10 spread at 74bps.
Read MoreNearly five and a half years into this bull market we still sometimes here the ”cash on the sidelines” argument as justification for further gains in stocks. The problem is that this argument hasn’t really been valid since 2010.
Read MoreA lot can happen in 10 years. Elections, World Cups, various government regimes, the Olympics, and Arrested Development have all come and gone several times in a span of a decade. But how much do companies change? That is the question we are attempting to answer today.
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The unique behavior margin debt held in NYSE accounts this year continued in July. After looking like it had reached a structural peak in February, margin debt surged back in June. Now the latest data point for July shows NYSE Margin Debt dropped by about $4 billion.
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Is the US economy about to lift-off out out of the recovery phase and enter into a self-sustaining expansion? Or is the US economy cratering towards a debt constricting, deflationary recession? Few questions in economics or finance garner as much emotion and flamboyant diction as to where is the economy ”heading”.
Read MoreEarlier this week we touched on the fact that new highs in individual stocks have not expanded much despite the continued new highs all year in the headline indices.
Read MoreWhen it comes to safe haven investments, the world generally invests in two assets: US Treasuries or German Bunds. Recently, bunds seem to be the preferred ”risk-free” investment of choice by a wide margin which has historically been a negative signal for stocks .
Read MoreWhen it comes to stock valuation, it makes sense that the fastest growing industries should command the highest valuations. And as we will show, in general this holds true. However, there are always exceptions and this is where one can find interesting mispricings. Let’s set up the data for a moment.
Read MoreEarlier today we highlighted the absolute collapse in the number of stocks experiencing price gaps at the open of trading. In a similar vein we highlight here the absolute collapse in the number of stocks experiencing big price swings on a given day.
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We’ve explored on multiple occasions here and here and here the absolute collapse in volatility in most asset classes so far in 2014.
Read MoreIn our last quarterly video (link here) we argued that counter-cyclical stocks in Asia are attractive. Counter-cyclical stocks are those in the utility, telecom, consumer staples and health care sectors of the MSCI Asia-Pacific index. Slicing that a little finer, we recommended focusing attention on the growth counter-cyclical components of Asia, Japan in particular.
Read MoreGlobal stock investors have continued to purchase Japanese shares despite the relatively lackluster economic statistics coming out of the world’s third largest economy.
Read MoreIn our latest quarterly presentation in July, we noted how spare capacity in the economy may be much smaller than is generally perceived. We found out today the FOMC came to similar conclusions in their latest FOMC meeting.
Read MoreAccording to data released earlier today, he mini-boom in European construction that began earlier this year came to an abrupt halt in June, as output declined by more than 2% year-over-year (from a multi-year high of more than 7%yoy in April): Growth in building construction and civil engineering projects both turned negative: On a country
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