Green Book March 2007
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Featured Articles
2007 Outlook: CPI Tame First Half With Moderate Economic Growth
We still believe interest rates are headed higher in 2007. Investors have sought the safety of U.S. Treasuries amid concerns of slowing economic growth and sub-prime jitters, sending ten year T-Note yields to their lowest level since December 2006.
Are Current Inventory Levels Cause For Concern?
This month’s “Of Special Interest” examines the issue of rising inventory levels. Aggregate inventory levels for U.S. manufacturers have risen to within 1% of previous highs recorded in early 2001. If sales momentum continues to lose steam, expect inventory correction to take hold later this year.
Bond Sentiment Remains Depressed…..Short-Term Rally Could Continue
Inflation pressures have not yet abated and we believe that bond yields could tick up later this year, as those pressures eventually flow through to the CPI.
Breadth & Leadership: Bull Markets Rarely (S)Top On A Dime
Market breadth moved down in tandem with stock market indices, but is not showing any divergences. All advance/decline lines were making new highs just before the downturn, and bull markets do not end with advance/decline data posting new highs.
February Market Action...What Was That?
Although the markets continued to trend higher for much of the month, the steep losses on February 27th reminded us all again what a good dose of market volatility felt like. Feel better now?
Inflation Still A Potential Threat
Inflation trends are a mixed bag at present.
Introducing Leuthold's Small Cap Groups & Group Selection (GS) Scores
Beginning this month, we’ll be distributing a new research publication: Leuthold’s Small Cap Groups. The core of this new publication will be a 15 factor, small cap group selection model based on our time tested, and highly successful, Group Selection (GS) methodology (with a few twists).
LBO Update…..Strong Performance From Leuthold LBO Quant Screen
Fresh LBO screen run in February 2007.
Modifications To Leuthold Growth Versus Value Methodology
We have modified our Small Cap and Mid Cap Growth versus Value methodology, improving the algorithm for distinguishing between growth and value to make the components more reflective of these sectors.
Mutual Fund Flow…..U.S. Equity Fund Flow Improves In February
The $8.1 billion going into open-end U.S. stock funds is a good sign that individual investors had been warming up to the U.S. stock market recently, although recent stock market volatility could change all that.
Sector Strategy: Put Your Money Where The “Puts” Are
Quantitatively, we have found that option trading volumes provide good, contrarian information on investor sentiment toward market groups.
View From The North Country
Even though it is entering its sixth year, the Industrial Metals play is not over. It seems to be entering its third and last act, an act that could run for at least another 18 months.
Table of Contents
Stock Market
- View From The North Country
- February Market Action...What Was That?
- Breadth & Leadership: Bull Markets Rarely (S)Top On A Dime
- Sector Strategy: Put Your Money Where The “Puts” Are
- Modifications To Leuthold Growth Versus Value Methodology
- LBO Update…..Strong Performance From Leuthold LBO Quant Screen
- Mutual Fund Flow…..U.S. Equity Fund Flow Improves In February
Of Special Interest
Macro Monitor
- 2007 Outlook: CPI Tame First Half With Moderate Economic Growth
- Bond Sentiment Remains Depressed…..Short-Term Rally Could Continue
Equity Strategies
- Introducing Leuthold's Small Cap Groups & Group Selection (GS) Scores
- Health Care Groups Show Strong Improvement In March GS Scores– Buying Managed Health Care
Inflation Watch
2007 Outlook: CPI Tame First Half With Moderate Economic Growth
We still believe interest rates are headed higher in 2007. Investors have sought the safety of U.S. Treasuries amid concerns of slowing economic growth and sub-prime jitters, sending ten year T-Note yields to their lowest level since December 2006.
Are Current Inventory Levels Cause For Concern?
This month’s “Of Special Interest” examines the issue of rising inventory levels. Aggregate inventory levels for U.S. manufacturers have risen to within 1% of previous highs recorded in early 2001. If sales momentum continues to lose steam, expect inventory correction to take hold later this year.
Bond Sentiment Remains Depressed…..Short-Term Rally Could Continue
Inflation pressures have not yet abated and we believe that bond yields could tick up later this year, as those pressures eventually flow through to the CPI.
Breadth & Leadership: Bull Markets Rarely (S)Top On A Dime
Market breadth moved down in tandem with stock market indices, but is not showing any divergences. All advance/decline lines were making new highs just before the downturn, and bull markets do not end with advance/decline data posting new highs.
February Market Action...What Was That?
Although the markets continued to trend higher for much of the month, the steep losses on February 27th reminded us all again what a good dose of market volatility felt like. Feel better now?
Inflation Still A Potential Threat
Inflation trends are a mixed bag at present.
Introducing Leuthold's Small Cap Groups & Group Selection (GS) Scores
Beginning this month, we’ll be distributing a new research publication: Leuthold’s Small Cap Groups. The core of this new publication will be a 15 factor, small cap group selection model based on our time tested, and highly successful, Group Selection (GS) methodology (with a few twists).
LBO Update…..Strong Performance From Leuthold LBO Quant Screen
Fresh LBO screen run in February 2007.
Modifications To Leuthold Growth Versus Value Methodology
We have modified our Small Cap and Mid Cap Growth versus Value methodology, improving the algorithm for distinguishing between growth and value to make the components more reflective of these sectors.
Mutual Fund Flow…..U.S. Equity Fund Flow Improves In February
The $8.1 billion going into open-end U.S. stock funds is a good sign that individual investors had been warming up to the U.S. stock market recently, although recent stock market volatility could change all that.
Sector Strategy: Put Your Money Where The “Puts” Are
Quantitatively, we have found that option trading volumes provide good, contrarian information on investor sentiment toward market groups.
View From The North Country
Even though it is entering its sixth year, the Industrial Metals play is not over. It seems to be entering its third and last act, an act that could run for at least another 18 months.
Stock Market
- View From The North Country
- February Market Action...What Was That?
- Breadth & Leadership: Bull Markets Rarely (S)Top On A Dime
- Sector Strategy: Put Your Money Where The “Puts” Are
- Modifications To Leuthold Growth Versus Value Methodology
- LBO Update…..Strong Performance From Leuthold LBO Quant Screen
- Mutual Fund Flow…..U.S. Equity Fund Flow Improves In February
Of Special Interest
Macro Monitor
- 2007 Outlook: CPI Tame First Half With Moderate Economic Growth
- Bond Sentiment Remains Depressed…..Short-Term Rally Could Continue
Equity Strategies
- Introducing Leuthold's Small Cap Groups & Group Selection (GS) Scores
- Health Care Groups Show Strong Improvement In March GS Scores– Buying Managed Health Care