The US Dollar has quietly been strengthening lately. As measured by the NYBOT Dollar Index, the USD has increased by 2.6% since the end of June and is at it’s highest level since September 2013.
Read MoreWe noted yesterday how treasury bond yields keep falling along with the reduction of fed purchases. This inspired us to dig deeper into our chart library to see how other asset classes or economic statistics have performed in relation to our taper model.
Read MoreJapan’s leading indicator posted a modest gain in June but remains well below the highs set back in January of this year (chart 1). Interestingly though, it’s the less followed coincident indicator that gives us pause.
Read MoreWhile the world has certainly become flatter and globalization isn’t going anywhere, different regionally stock market characteristics still do exist. One such example is what management decides to do about dividends.
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Despite today’s modest uptick in treasury bond yields, the downward trajectory in yields coinciding with the Fed’s tapering of asset purchases remains firmly intact. Admittedly we’ve been harping on this point now for months, so we’ll keep this post short and sweet.
Read MoreEvery week we regress the performance of all regions and sectors in the MSCI World Index against a variety of fundamental, technical and economic variables. We deconstruct an aggregate into deciles and compare the performance of each decile to a given factor.
Read MoreRetweeted: Twitter-addict? Interested in finance? @WSJmarkets has the list of must-read feeds for you: http://blogs.wsj.com/moneybeat/2014/08/14/50-financial-twitter-feeds-you-must-follow/GaveKal attests that the link to above is independent of GaveKal, and certifies that to the best of its knowledge, the information included in such social media is accurate.
Read MoreLiquidity sensitive assets such as small cap stocks have had a difficult 2014. Over the last three months they have underperformed large caps by roughly 9%. What clues about asset allocation does the performance of liquidity sensitive assets give us?
Read MoreRetail sales in the US were unchanged in July, which prompted us to dive into our chart library to figure out what may be going on underneath the surface of the economy.
Read MoreEvery week we calculate the relationship between various factors and the performance of equities around the world. We do this to understand what factors–like beta, valuations or fundamental factors–are most highly associated with the movement in equity prices. Over the last year earnings momentum has moved to center stage in Asia.
Read MoreAs we have highlighted recently (see Europe: Short-term Oversold, Detailing The European Correction and Down Days On the Rise In MSCI Europe) stocks in Europe have been under pressure. We count four industry groups that have tipped into correction territory: transportation, automobiles, food & staples retail and retailing.
Read MoreBarely a week after 2Q GDP and a slue of revisions indicated that the economy has performed better initially indicated in the first half of 2014, bond yields are again making new 1-year lows.
Read MoreA few weeks ago, we noted the relationship between an inverted VIX curve and declines in the S&P500 (see here). Taking a longer-term view, we see that the last few years have been relatively quiet–characterized by few, intermittent inversions and minor pullbacks in the index.
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Over the last 50 days European equity markets have taken a beating. The average stock in Europe is down 6%, and both Portugal and Austria are down more than 10%–putting them in correction territory. Down almost 9%, Germany isn’t far behind.
Read MoreThe ISM Non-Manufacturing index came in much higher than expected for July at 58.7 vs consensus of 56.5. Consequently, it helped boost our ”GDP weighted” PMI to it’s highest level since December 2005. The new orders index also reached it’s highest level since August 2005.
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