Inside The Stock Market ...trends, cross-currents, and outlook
Putting Lipstick On The “PIIGS”
Global Industries equity portfolio has little to no exposure to the PIIGS (Portugal, Ireland, Italy, Greece, and Spain) as our Global Group Selection Scores have not led us to industries that have many component stocks domiciled in those countries. However, if this work leads us to groups with heavier exposure to the PIIGS, we’ll buy them without blinking.
The Higher Payout The Better: A Global Perspective on Dividends and Buybacks
This month Chung Wang examines historical performance of companies that increase or initiate dividends, as well as companies that are buying back stock. These stocks tend to significantly outperform.
Interest Rate Moves And Stock Prices… Another Look
At times it is indeed possible to have interest rates rise and stocks also move higher, and it is also possible to have rates decline and stocks fall.
Another Market Milestone
It is sobering to consider that an historic, 13-month market stampede (one now exceeding 75%) has done nothing more than restore the market to levels first seen twelve years ago.
Using A Few Bear Arguments To Make A Bullish Case
Doug Ramsey utilizes several bear market arguments to build a bullish case. Rising Interest Rates, Overbought Market, Low Volatility, and Low Trading Volumes, can all be looked upon in a BULLISH light.
Rising Interest Rates Don’t Prohibit Rising Stock Prices
Expect stock prices and interest rates to move higher together for a while. There are plenty of examples of this historically...although some of them go waaayyyy back.
Thoughts On China Investing: Domestic Consumption Versus Infrastructure Play
Jun Zhu makes a compelling case for focusing China equity exposure on consumer stocks. Increases in bank “Required Reserves” mandated by China government will have greater impact on Infrastructure stocks, while consumerism is still being supported and encouraged.
Popularity, Agreement, And Trust: A Global Perspective Of Investor Preference
Analysts are playing an increasingly important role in today’s market. In this section, we focus on the market’s interpretation of three characteristics related to analysts estimates: Popularity, Agreement, and Trust.
First Year In The Books… And Still Bullish
Global bull market is now one year old. U.S. stocks are probably in fair value territory, but should move to moderately overvalued territory as both the economy and investor sentiment improve.
Giving Bonds Short Shrift
At the end of November, The Leuthold Group established a 7% short position in long-term Treasury bonds across all tactical asset allocation funds (Core, Asset Allocation and Global). We view this as a longer-term position.
Commodities… And The “Old Normal”?
A loss in leadership by commodity-oriented stocks could be the big surprise for 2010. Commodity sentiment is elevated, and the sector should feel the after-effects of a capacity building binge from late last decade. Rising inflation—if it’s the monetary debasement variety—won’t lift the sector.
What Keeps Us Up At Night
We consider it incredible that most of the leading economic indicators have staged such traditional V-shaped rebounds with virtually no boost from the housing sector.
Rising Inflation: Not Always Bad For Stocks… Especially Small Caps
A look at stock performance in various inflation environments would seem to predict below average performance in 2009, but threat of monetary debasement inflation in 2011 and beyond could set the stage for poor performance.
Liquidity Drying Up… Some Trends Worth Watching
Our broad read of the stock market is still bullish, but we can’t help noticing that the concerted effort to supercharge the economy via liquidity may be losing some steam.
A Global Perspective: Investor Preference For Earnings And Revenue Risks
A look at earnings and revenue risk to see how the market reveals its preference.
Despite January, Big Picture Still Bullish
Don’t think we’ve seen a cyclical top, because that would mean everything essentially topped at the same time. Breadth has yet to peak in this cycle and that is one reason we expect the market to move higher over the near term.
The “New Normal”: Yes, They Ring A Bell At The Bottom
The “New Normal”, just like the late 1990’s “New Era”, will likely fade from popular jargon over time. Counter to “New Normal” reasoning, the Consumer Discretionary sector has demonstrated remarkable performance.
Large Cap Versus Small Cap: Performance Parity 1979 To Date
Over this entire period, the S&P has narrowly beaten the Russell 2000, but not by much.
2009: Not Monotony, But Close
The 2008 worst performers shot to the head of the class in 2009. History however shows it doesn’t usually pay to buy the prior year’s laggards in hopes of hitting it big the next year.
2009 Dreams And Nightmares...A Look Back At What Might Have Been
Based on loud bearish complaints about the “junk rally”—and our commentary on the Revenge-of-the-Nerds (anti-momentum) effect—it should come as no surprise that 2009 marked the most dramatic reversal of industry leadership we have seen in our twenty-plus years of tracking this work.
Subscribe to Advisor Newsletter