All posts by admin

19Mar/18

Weekly Global Equities Strategy Update

Y-t-d, $9.8Bn has flowed into tech stocks, and $7.3Bn into financials, while $41Bn
has flowed into emerging markets and $31Bn into Japan. Nevertheless, shares
around the world were stuck on their worst run since November earlier today, as
caution gripped traders in a week in which the Federal Reserve is likely to raise
US interest rates and perhaps signal as many as three more hikes lie in store this
year. A near 1% drop for Europe’s main bourses, amid a flurry of gloomy EU
company news and weaker Wall Street futures meant MSCI’s World index was
down for a fifth day running.

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23Feb/18

FX & Commodities Outlook

Two weeks ago the World Bank has forecast prices to increase modestly in 2018 for
almost all energy and non-energy commodities, with the exception of fertilizers, metals and minerals. The World Bank now sees Oil (WTI) to average $56/barrel in 2018, a 6% rise from $53/barrel in 2017, still significantly below our 2018 price target of $78 for WTI.

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20Feb/18

Weekly Global Equities Strategy Update

In the US, US economic news this week is quiet. Focus is on FOMC meeting minutes
following appointment of a new Fed chief. Short term political uncertainties remain,
including North Korean “sabre rattling”, struggling NAFTA negotiations, possibly another shut-down of the US government and increased scrutiny by special council on Russia’s influence on the Presidential election。 Continue reading

12Feb/18

Weekly Global Equities Strategy Update

Foreign investors are still tremendously underweight in Japanese equities, both
on a trade weighted and an overall GDP-weighted basis, and we think there is
room for significant further upward momentum in the short-medium term. We
continue advising to use those for long-term asset allocation build-ups to
overweight Japanese equities on a relative basis, as we do see more value in
Japanese equities still at current valuations than in the US.

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18Dec/17

Weekly Global Equities Strategy Update

We like to reiterate our positive stance on Japanese equities, combined with
partial hedging of the Yen, as the BoJ’s continued easing, and the potential to
drive it lower against major currencies including the US$, Euro, and AUD, are
fundamentally very attractive, and also will benefit from a seasonal period of
strength until end of March (end of fiscal year 2017).

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04Dec/17

Weekly Global Equities Strategy & Charts Update

Financial markets this week will focus on the US November Employment report to be released on Friday. Short-term political uncertainties remain, including North Korean “sabre rattling” and increased scrutiny by special council on Russia’s influence on the Presidential election.Globally, most of the broadly based equity indices closed at or near all-time highs on Friday.

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20Nov/17

Weekly Global Equities Strategy & Charts Update

Globally, not many important data releases are due today but the week is going to be interesting. Short term political uncertainties remain, including North Korean “sabre rattling”, slow progress by Congress to pass crucial legislation (notably tax reform) increased scrutiny by special council on Russia’s influence on the Presidential election, and the increased likelihood of a German re-election weigh on prices to continue to rise.

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11Oct/17

Weekly Investment Strategy Update & Charts Update

The International Monetary Fund today published a report indicating that The global economic recovery has strengthened financial stability but easy monetary and financial conditions against a backdrop of sluggish inflation is elevating medium-term risks. The IMF upgraded its global economic growth forecast for 2017 by 0.1% point to 3.6%, and to 3.7% for 2018, from its April and July outlook, driven by a pickup in trade, investment, and consumer confidence.

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03Oct/17

Weekly Investment Strategy Update & Charts Update

Investors increasingly poles apart on Equities versus Bonds The latest sentix survey
indicates that investors remain resolutely upbeat on equities and deeply downbeat on
bunds. As a result, the sentiment gap between bunds and Eurozone equities is now
large and growing, albeit the gap has yet to reach historic lows.

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25Sep/17

Weekly Investment Strategy Update & Charts Update

In the Americas, Friday’s release of the publicly available data from ECRI puts its
Weekly Leading Index (WLI) at 143.4, unchanged from the previous week. Y-o-y the 4-week moving average of the indicator is now at 2.83%, down from 3.09% last week and its 11th consecutive week of declines. The WLI Growth indicator is now at 0.0, also down from the previous week, it’s lowest since March of 2016.

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18Sep/17

Weekly Equities Investment Strategy Update & Charts Update

Uncertainties remain for global financial markets, including assessment of impact of two hurricanes on the US economy (and possibly two more hurricanes approaching the US), North Korean “sabre rattling”, failure by Congress to pass crucial legislation (notably tax reform), etc. Additionally, concerns are rising that a 3rd major hurricane could impact the US with a likely landfall as early as Sunday.

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15Sep/17

Actionable Forex Ideas – Outlook September 2017

We see the Euro strength to continue, particularly post German Presidential lections, which we see as a fait-accompli in favor of Ms.Merkel to lead Germany for a 4th term. Another major Euro strength should continue on the back of Mr. Juncker’s state of the Union speech and fundamental and monumental renewed focus of the EU Commission and its members for the direction of the EU going forward.

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24Jul/17

Weekly Investment Strategy Update & Charts Update

We continue to see the Euro to stabilize further and continue to rise. Safe heaven
currencies like the US$ and like Gold will reverse course and decline. As per our
Q3 Global Investment Outlook & Strategy, the EUR/US$ is on track to rise to our
Q3 end target of 1.18, and our 2017 EUR/USD target of 1.18 – 1.24.

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10Jul/17

Weekly Investment Strategy Update & Charts

As per our Q2 Global Outlook and Investment Strategy, we have been advising
our clients to reduce exposure to the US$ ($USD) and US equities ($SPX), and
instead increase allocations into US long bonds, namely 10-Year Treasuries
($TNX), and into EU and EM currencies and equities, which form a tactical Asset
allocation call has been spot on so far in the current quarter.

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05Jul/17

Weekly Investment Strategy Update & Charts

Europe is emerging as a region that offers a stable investment environment, just as the fate of other economies is harder to predict. The UK is facing complex divorce
negotiations with the EU. There are significant economic downsides from Brexit for the UK. The damage to the EU economy is probably limited, and the impact might well be positive. Especially if companies and financial institutions decide to move to the continent.

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31May/17

Weekly Investment Strategy Update

World trade flows grew in Q1, continuing a recovery that began in 2H of last year in an indication that the global economy may be set to enjoy a year of stronger growth. World trade flows grew at the slowest pace since the financial crisis in 2016 as a whole, but there are signs 2017 will mark a rebound.

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08May/17

Weekly Investment Strategy & Charts

Since March of last year, we also started to see increasing macro evidence that
the Euro area was going to be a more stable, secure and reliable place to invest
in than the UK and US, but our call fell mostly on deaf ears until 2017. Europe has
emerged once again as a region that offers a stable political and macro economic
environment, just as the fate of other economies is harder to predict.

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02May/17

Weekly Investment Strategy & Charts

As per our Q2 Global Outlook and Investment Strategy, we have been advising
our clients to reduce exposure to the US$ ($USD) and US equities ($SPX), and
instead increase allocations into US long bonds, namely 10-Year Treasuries
($TNX), and into EU and EM currencies and equities, which form a tactical Asset
allocation call has been spot on so far in the current quarter.

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24Apr/17

Weekly Investment Strategy & Charts

We see European stocks will likely rally for another short period, until they reach the zenith of annual dividends paid out in mid-May. We recommend for investors to start reducing equity positions into the last rally before the summer, as we are forecasting for a -12% to -15% decline in European and US stocks to materialize once the period of seasonal strength for this asset class will pivot into their strongest period of seasonal weakness from May to October.

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17Apr/17

Weekly Investment Strategy & Charts

Headline prices in the US, UK and Europe are already at or above 2%. At the same time, seven central banks globally are still running negative interest rate policy (NIRP), while aggregate global quantitative easing continues to expand at breakneck speed. Looking ahead, we think central bank liquidity, the major factor that helped support risky assets during the post-crisis era, might peak by early 2018.

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04Apr/17

Morning Market Commentary

Positive seasonal tendencies for the parts manufacturers can stretch
into the summer, however, with the US consumer toppling, we are expecting for
the period of seasonal strength for the Auto & components Industry to come to
an end earlier this year, hence why we are advising investors to sell/reduce all
stocks on the sector and wait for -10% to -20% lower prices by mid summer
before re-entering full allocations.

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29Mar/17

2017 Q2 Global Markets Outlook & Investment Strategy

The global economy is still slowing, negatively affected by geo-political distress, but will accelerate in 1H 2017. +85% of the central banks are still supporting the
global economies by additional monetary stimulus. Productivity growth to improve due to labor, financial and product markets reforms in place, particl. Europe Investment to pick up (modernization of capital stock)

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27Mar/17

Weekly Investment Strategy & Charts

Given the AHCA defeat last Friday, financial markets have to re-assess reality versus wishful thinking. As we had been writing for the past 5 weeks, US assets (US$ and US equities) had been very overbought, and had failed to move towards new highs, and double tops had been put in place. We see Friday’s equity markets’ reversal as a major catalyst for trend change, and the catalyst for investors to focus on major asset re-allocation thinking.

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15Mar/17

Morning Markets Commentary & Charts

In the US, the main event in the markets today will be the FOMC meeting. A rate hike
of 25bps seems a done deal, and seems fully priced into bonds and the USD, however market participants will be looking towards the statement regarding future rate hikes and a possible reduction in the Fed’s balance sheet.In the US, the main event in the markets today will be the FOMC meeting. A rate hike of 25bps seems a done deal, and seems fully priced into bonds and the USD, howeve market participants will be looking towards the statement regarding future rate hikes
and a possible reduction in the Fed’s balance sheet.

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27Feb/17

Weekly Market Commentary & Charts

We continue recommending for investors to use the current US$ strength and
diversify into the seasonally better performing European and EM equities. As we
have written in the past 3 months, we see a stronger case in favor of higher
European allocations until mid May. We believe that the political and sovereign
tail risks for Europe, particularly with respect to potential Eurozone
disintegration, are fully priced in the weak Euro and European equities.

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21Feb/17

Weekly Commentary & Charts

We continue recommending for investors to use the current US$ strength and
diversify into the seasonally better performing European and EM equities. As we
have written in the past 3 months, we see a stronger case in favor of higher
European allocations until mid May. We believe that the political and sovereign
tail risks for Europe, particularly with respect to potential Eurozone
disintegration, are fully priced in the weak Euro and European equities.

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06Feb/17

Weekly Market Commentary & Charts

Continue to Sell/short US$ against commodities based currencies like
BRL, AUD, CAD, but also against the EUR
Overweight US 10 Year Treasuries
Continue to Overweight Commodities, Energy, metals
Overweight foreign stocks short and medium term, namely European
(German, French, Spanish, Dutch), Canadian, Japanese, Chinese, Russian
and Brazilian equities
Underweight US & UK equities

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23Jan/17

Weekly Market Commentary & Charts

Investors are now clearly waiting for concrete economic policies from the Trump administration, with both the upward move in US yields and the US$ losing some momentum. Furthermore, we think there is an increasing chance that global risk sentiment could be affected by a possible standoff between China and the US. Longer term, we could see risks rise to a global recovery from more economic protectionism.

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17Jan/17

Weekly Market Commentary & Charts

The US$, (and all US$ priced and related asset classes like US equities and US
treasuries, commodities) are simply overbought, overheld, overvalued and
overdue for a correction. We see better value in foreign equity markets,
particularly as Japanese, Chinese and European equities are in the strongest
period of seasonal strength until end of April.

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12Jan/17

Basic Resources & Metals Commentary & Charts

After some significant consolidation in the industry over the past 2 years, (M&A, capacity adjustments, strategic alliances, etc.) we had forecasted that the 2H of 2016 would be a turning point for basic resources pricing and outlook. At this point, we would like to reiterate that we are expecting for basic resources and metal prices to advance by another +25% in 2017 from current levels.

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09Jan/17

Weekly Market Commentary & Charts

We are recommending for investors to hold seasonally attractive equity positions that remain in an intermediate uptrend and continue to outperform the S&P 500
Index (e.g. precious metals, technology, selected Canadian energy, DIS, UNH,
AAPL, etc.). Profit taking in other positions is appropriate. As highlighted in our
Fixed Income commentary, year-end portfolio adjustments continue, most
notably the switch to fixed income securities from equities.

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06Jan/17

Market Commentary & Charts

Economies like Russia, Germany and Japan, all having significant trade surpluses and also current account surpluses, have had a compression in interest rates over the past 4 months, however, US interest rates despite a lower growth rate and also despite a widening trade deficit and a growing current account surplus has seen its interest rates rise significantly more than those other economies.

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21Nov/16

Weekly Market Commentary & Charts

The very reliable long-term equity/bond model favor bonds over equities, therefore, investors should continue to overweigh their portfolios with bonds over stocks for safety and better return. Can investors’ temporary blindness become the “trumping” reason to go long bonds after the inherent correction of the 10Year treasury yields moving to our 2.35% yield target? We think so.

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31Oct/16

Weekly Market Commentary & Charts

Economic focus in the US next week is on the FOMC meeting. Consensus is that the
Fed Fund rate will remain at 0.25%-0. 50%, but the Federal Reserve will give a clear
signal about increasing the Fed Fund rate by 0.25% at its December meeting. Other US economic reports are expected to confirm that the US economy is growing at a slow but steady rate.

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20Oct/16

Market Commentary & Charts

As per our 2016 Global Investment Outlook & Strategy which we published last
year in December, when comparing Real Assets versus Financial Assets, the
following chart shows that real assets are at all-time lows versus financial assets.
The time to buy into capital goods, mining, and railroad and energy stocks has
never been better than right now.

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13Oct/16

Market Commentary & Charts

In the Americas, investors in the US are awaiting the minutes of the FOMC meeting are supposed to show the FED taking a clearer stand on when they are going to raise rates. The market is getting more convinced, one more time, like it did for the past 2 years so many times, only to be wrong, over and over again. The odds of a December rate hike increased yet again to 74.5% from 69.5%. The odds of two hikes increased from 5.5% to 7.4%.

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10Oct/16

Weekly Market Commentary & Charts

The period of uncertainty for world equity markets continues. Many equity markets,
commodities and primary sectors have returned to the top of their trading range
previously reached in mid-July. Establishment of another intermediate uptrend is
unlikely prior to the US Presidential election on November 8th. Prospects following the Presidential election are positive. Seasonal influences begin to change in the month of October.

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03Oct/16

Weekly Market Commentary & Charts

The period of uncertainty for world equity markets continues. Many equity markets,
commodities and primary sectors have returned to the top of their trading range
previously reached in mid-July. Establishment of another intermediate uptrend is
unlikely prior to the US Presidential election on November 8th.Prospects following the Presidential election are positive.

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01Oct/16

2016 Q4 Global Markets Strategy & Equities Outlook

As highlighted in our 2016 Global Investment Strategy & Outlook, the global macro fundamentals had been slowing as we anticipated, and consequently Central Banks in the US, Japan and Europe have been adding liquidity to dampen the slowdown. Contrary to most “sell-side” big firms, which had been predicting 4 rate hikes by the FED in 2016 (GS, JPM, UBS, DB to name just a few) besides “buy-siders” (of the likes of Bill Gross/Pimco/Janus, Mohammed El Erian/Allianz and too many others to name).

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29Sep/16

Morning Market Commentary

The WTO estimated global trade volume is set to grow just 1.7 percent in 2016, a much lower forecast compared with April’s 2.8%. It marks the first time in 15 years that international commerce has grown more slowly than the world economy. World trade has been in decline since 2H 2014 (totally coincides with the parabolic rise of the US$ since June 2014).

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27Sep/16

Morning Market Commentary

Not a lot of substance on differentiation of both candidates’ 4-year economic and socio-political pans. One hour into the debate, the candidates had failed communicating their priorities. There’s been no “on my first day in office …” or “the first bill I’ll sign …” or other similar promises. Trump is most animated about trade and immigration, but it’s harder to tell which issue, if any, Clinton is putting at the center of her campaign. The only noteworthy difference between both candidates highlighted in last nights debate was when they debated how to grow jobs and incomes; Trump mentioned cutting regulation, while Clinton vowed to boost manufacturing jobs; both touted their tax and trade policies.

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26Sep/16

Weekly Market Commentary & Charts

Slower than consensus economic news from the US, Japan, Brazil and smaller parts of Europe last week proved to be good news for markets. Additionally, as we were
expecting, the Federal Reserve decision to maintain the Fed Fund rate at .25%-0.50% on Wednesday afternoon boosted equity, commodity and bond prices. Economic news this week is expected to confirm an additional slowdown in US economic growth in Q3.

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