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In difficult markets, we have become more appreciative of some of life’s small gifts. For example, it’s been quite a while since we’ve heard it argued that this is “the most hated bull market of all time.”

While we’ve emphasized several negative developments within the MTI’s Economic composite in recent months, not all of the evidence leans bearish. Outside of the oil patch, commodities have struggled to make a clear breakout, possibly reflecting the short-term bounce in the dollar.

Athletes aren’t the only ones known to sometimes suffer a “sophomore slump.” Presidents do, too… at least according to the historical verdict of the stock market...

Earnings-related measures have remained healthy, but the more heavily-weighted components related to monetary and interest rate trends continue to migrate towards the negative side of the ledger.

Analysts are still coming to terms with the impact of the big corporate tax cut, as shown by the dispersion still existing across S&P 500 EPS estimates in 2018. But they should also be watching the line item that’s contributed the most to the breakout in profit margins above historical levels: interest expense...

While we’ve always emphasized the importance of the “weight of the evidence” over the individual MTI factor categories, it’s worth highlighting some key differences between the 2018 correction (which saw a loss in the S&P 500 of 10.2% at the February 8th closing low) and the 2015-2016 S&P 500 correction of 14.2%.

Yields on 10-year Treasury bonds have still not breached the 3.00% level that many believe will stick the proverbial “fork” in the secular bond bull market that began in 1981. That could well in happen in the next few weeks, but we believe it’s important to step away from the daily fray and reflect upon the damage that’s already been done.

It’s mystifying that the Momentum work has not deteriorated further during the course of this correction. Despite the -9.3% S&P 500 loss through Friday’s close, the net category reading remains at a moderately bullish level.

After months of research and econometric modeling, we’ve come up with a list of U.S. and foreign industries, companies, and individuals we expect to benefit from a trade war between the U.S. and China.

In light of the remittances they are about to drop in the mail, many readers will find it incredible that the U.S. Treasury has largely sat out the last two years of the stock market and economic upswing.

During each of the last five months, the U.S. economy has shown a broadening array of “late-cycle” characteristics.

We’ve chronicled the ever-expanding gap between commodity prices and commodity-oriented equities.  Don’t expect a rebound in one based on the strength of the other. There’s no clear historical tendency for the weaker asset to catch up.

Fourth quarter earnings were the last ones to be burdened by a 35% top marginal corporate income tax rate, and therefore seem to have been given a pass by the analyst community.

A good rule of thumb for thematic and sector investors is that stock market leadership rarely repeats itself in consecutive cycles.

The first several years of this recovery badly underperformed forecasts, with partial blame going to a pair of deflationary shocks (the European debt crisis and oil price collapse).

As equity investors, we’ll readily admit to an excessive focus on the Federal Funds rate and the 10-year U.S. Treasury yield.

While the January 26th bull market high illustrated none of the hallmarks of a major cyclical top, there are secondary signs that a stealthy distribution process may be underway, such as an overwhelming bias toward opening market strength followed by intraday weakness.

Yields on 10-year Treasuries are up 10 bps since stocks peaked in January, a clear break from the behavior of prior corrections. The last four stock declines of 10%+ were self-medicating—having been accompanied by bond yield declines of 50 to 150 basis points.

Our shortest-term put/call measure has yet to reflect the level of fear usually triggered by a correction of this size. Meanwhile, the market setback has done almost nothing to stymy the optimism of either market newsletter writers or mutual fund timers.

The longest and probably most complex bull market in history is not going to make a clean and decisive exit.