Similar to last week’s disappointing ZEW survey (see here), the German Ifo survey fell for the third time in four months in June.
Read MoreRecent economic stats have given investors reason to worry about an inflation scare. The stocks that tend to outperform in such an environment are what we call ”late cyclicals”, which are industrial, energy and basic material companies.
Read MoreOf the 30 factors we track, dividend yield and 3-month change in EPS estimates have had the highest r-square value relative to MSCI World performance over the past month.
Read MoreAs another relatively quiet week in the market comes to a close, we thought we would step back from analyzing the market and briefly introduce to our readers a topic that we care greatly about and one that most of our readers are probably unfamiliar with. That topic is investments in intangible assets.
Read MoreGaveKal Capital will host a quarterly conference call on the GaveKal Knowledge Leaders Strategy.
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It feels like a new, meaningful merger or acquisition is announced daily– mostly because companies have been busy making deals.
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Many investors, including ourselves, look at the CBOE VIX to measure market volatility. Over the past few days the VIX has made multi-year lows and is back at levels last seen in 2006-2007. Another way that we look at volatility is by tracking the standard deviation of the daily price change in the market.
Read MoreThe Federal Reserve kept to its taper program that has been in place throughout this year. Both bonds and stocks reacted positively to the news right on cue as the Fed announcement was released at 12pm MST. The latest Fed projections were largely in line with March’s projections outside of change in real GDP.
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Over the last four years, analyst buy ratings in the MSCI Europe Apparel Retail sub-industry have hovered right around 50% for Inditex while those for H&M have expanded from ~15% to ~50% over the last year or so: Inditex H&M In addition to similar analyst assessments, the valuations for these two rivals do not vary
Read MoreWhile the MSCI World Index is just a smidge off it’s all-time high, the average stock is about 8% below it’s 252-day high. Recent history suggests that we will need a slight consolidation, either through price or time, in order to make way for further gains.
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It is easy to forget just how low valuations were in 2008 and how much they have expanded in the past six years.
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US housing starts for May came in below consensus at 1,001K units vs expectations of 1,036K units. Housing starts are still about 9.5% higher than they were a year ago. Regionally, housing starts are strongest in the Midwest while in the Northeast, starts are actually 5% lower than they were a year ago.
Read MoreThe ZEW Survey of economic expectations in Germany has fallen since the beginning of the year. As we have seen before (here), the current situation component remains benign while expectations for an improvement in the economy continue to decline.
Read MoreThe number of instances in which constituents of the MSCI World Index have experienced large price swings– plus or minus 5% in either direction– is approaching previously low levels that coincided with market declines: Asia-Pacific Europe North America
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60% of stocks in the MSCI World Index have experienced negative EPS revisions for the next fiscal year (FY1). Only two sectors, Financials and Information Technology, have at least half of their companies raising FY1 EPS estimates.
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