Latest Research

Continuing our series of introductions of new members of the Leuthold team, this month we present our token New Yorker and bottom up Clean Tech stock picker David Kurzman.

This month’s “Of Special Interest” section looks at six trends from the Supply/Demand front. Key to several of these trends is that investors chase performance: still seeing big inflows into bond funds, with big outflows from retail money market funds.

Doug Ramsey demonstrates that new bull markets can be expected to correct by 10% or more at some point — which may be why so many pundants are looking for a correction now. Past history shows that based on duration it would be early in the current bull market for a correction at this time, but based on  magnitude, the timing would be about right.

Market vacuum occurred during the 4 weeks following the collapse of Lehman Brothers, when the S&P 500 dove from 1250 to 900. This occurred during the recession, but it has been the Retailers that are among the few groups that have closed that gap.

Given the very long-term ebb and flow of market valuations, it is hard to believe that—with old valuation norms finally and decisively violated to the downside—the market will spring back to anything like the valuations seen in the middle of this decade.

Bubble groups rarely return as market leaders until after experiencing a prolonged trading range pattern. Technology currently appears to have paid its dues and could develop into the next market leader.

New group purchase of Integrated Telecom stocks.

Most quantitative portfolio managers employ some variation of the momentum strategy, and most have had a hard time with this particular strategy since the end of 2007.

Our first introduction is of Jun Zhu, who broke the mold by not being another white Midwestern guy.

Jim Floyd examines the revenue growth of the ten broad sectors in this month’s “Of Special Interest”.

Lots of people spinning economic and market statistics to cast doubt on the recovery and stock market rally. Doug Ramsey goes point by point to make an honest assessment about the current conditions. Things do actually look pretty good right now!

Two new equity groups added to Select Industries equity portfolio. Inclusion of Paper Products and Independent Power Producers pushes Materials and Utilities to small overweight positions.

A major long term theme developing on a global basis is Clean Technology. The Leuthold Group has built a dedicated portfolio to this theme by doing extensive research on 500 globally traded stocks that could ultimately be big winners in this very long term play.

Eric Bjorgen takes an expanded look at some fundamentals surrounding the Financial sector. While bank failures are rising, prior history shows that good performance can still be produced in this environment.

While U.S. banks are still seeing loan levels declining, China has seen a 24% increase in bank loans since the end of 2008. Assuming these loans are actually employed to build infrastructure, it would seem the recovery may be getting underway.

When clients ask about our country views, we suggest they take a look at our global group work because our Global Group Scores are capable of capturing country alpha!

A month ago we suspected June might see a big institutional rush into the stock market. The stampede never came, though, and the market finished essentially flat for the month.

Looking at alternative ways to play China. See this month’s list of H-shares trading in U.S. markets.

Even after a decline in global earnings of 46%, they could experience another 15% decline before reaching the bottom of the 40 year trend channel. It doesn’t look like last quarter’s stock market bottom means that an earnings bottom is imminent.

Believe it or not, 21 of our equity groups have not yet seen a quarterly decline in revenues. Several early cycle type groups have already experienced four quarters of declining revenues, but the good news is three groups have posted rebounds in revenues as of Q1 2009.