Latest Research

The second quarter of 1991 is history. While the market averages ended the second quarter about where they began, our Major Trend Index has lost quite a bit of ground in the last three months.

Has the June stock market decline set the stage for a good second half for stocks?

At this point, our work does not yet confirm a longer term shift in market leadership from growth to cyclical. Perhaps such a confirmation will take place in coming months (we suspect it will).

These days everyone seems to be focusing on the bulging supply of new equity, the IPO buildup, new equity financing by existing companies, secondary offerings, etc. How much is too much? When will the new supply burden break the back of the bull market?

A performance rundown for our equity market sectors (and other measures) ranked by June 1991 performance.

This has been a vintage “bounce” period, the best ever! Relative strength lagged in June for the first time this year. Per our monitoring procedure, it is time to take profits.

We did it. We took an initial 6% position in our “Clean Energy” (natural gas) sector this month, a move that has been under consideration for some time. The Leuthold Group has yet to be bagged by the natural gas bubble, so here is our chance.

Polling the Pros at Leuthold Group Luncheons...Derivative Markets Still Swing the Stock Market Up and Down

The stars of May, at least the last half of the month, were the stocks and groups most sensitive to the business cycle.

Last month this publication noted that “deep cyclicals” were intriguing but unimpressive from a technical standpoint. Then in the last two weeks of May, the cyclicals exploded on the upside, especially in the last week of the month.

A performance rundown for our equity market sectors (and other measures) ranked by May 1991 performance.

This has been a vintage “bounce” period, the best ever! We know that some of our smarter clients did play this game. Here’s a monitor for those fortunate and gutsy few.

We have surveyed the record of the S&P 500, examining performance in the first half and second half of each year. We focus here is on years with truly outstanding performance in the first half. What happened to the index in the subsequent six months?

By our tabulations, 57% of the industry groups are still below their 1987 peaks even though the S&P 500 is 16% above its 1987 peak. Which industry groups are leading and which are lagging?

In early May, the bond market was hit hard by a post Treasury financing sell off. It spent the rest of the month recovering.

In April, the media staged a Dow Jones 3000 celebration, but the stock market didn’t. After the April 17 close of 3004, the DJIA beat a hasty retreat with the S&P 500 following suit. By the end of April, the post 3000 decline took the market averages back down to where they started the month.

This could prove to be a very rewarding investment sector, assuming the market continues to favor technology and an economic recovery gets underway in late 1991.

This has been a vintage “bounce” period, perhaps the best ever! We know some of our smarter clients did play this game. The following section is a monitor for those fortunate and gutsy few.

The moving average was broken on the upside in March and relative performance was flat in April. In anticipation of this basic change in market focus our equity model has built up secondary stock exposure.

A performance rundown for our equity market sectors (and other measures) ranked by April 1991 performance.