Global Weekly FI & Forex Strategy Update
The IMF announced today that it expects global growth this year of 3.5%, down from 3.7% in 2018 and from the 3.7% it had forecast for 2019 back in October, and is trimming the growth outlook for the Euro-zone currency to 1.6% from 1.8%, but for now, keeping its prediction for US growth this year unchanged at 2.5%. Growth in emergingmarket countries is forecast to slow to 4.5% from 4.6% in 2018. The IMF expects the Chinese economy to grow 6.2% this year, down from 6.6% in 2018 and slowest since 1990.
Global Equities Strategy Update
As long as those issues weigh on investors’ minds, we see it hard for global equities markets and commodities to rise from current levels.
Q1 2019 Global Markets Outlook & Investment Strategy
For Q1 2019, we see best alpha opportunities for investors in the G-10 equities, particularly in global Consumer goods, industrials, Manufacturing, Utilities, Insurance. Although globally equities are now less expensive, US equities are currently representing the highest valuation risk, with headwind of a “too strong” USD not factored in correctly by analysts yet..
Global Equities Strategy Update
All in all, given the rosy forecasters needing to sober up a bit and revise forecast down for the next 2 – 3 years, we do not see the FED likely to continue to tighten its monetary stance to keep inflation in check, which would tighten global financial conditions and could trigger further emerging-market capital outflows and currency depreciation, and implicitly a prolonged USD appreciation, which neither the US policymakers nor the consumer
Global Equities Strategy Update
We now are expecting for the global economy to expand 3.6% in 2018, which, if confirmed, would represent the strongest expansion in seven years.
Fixed Income & Currencies Strategy Update
Q3 global growth likely slowed as trade war fears intensify, and following Q2’s strong showing. A preliminary Q3 GDP estimate for the global economy put y-o-y growth at 3.3%
Weekly Equities Strategy Update
Investors are facing too many fast changing unknowns, such as an all-time low 3.7% US unemployment, globally slowing (and most likely more downward adjustments and revisions of US and EU GDP growth rates {a phenomenon not rarely seen post political elections}), and likely an unsustainable US GDP rate in the 2.7% to 3.7% range, besides still measured inflation (which we continue to forecast for 2019) however, which the Federal Reserve tries to fight with another December likely rate cut.
Weekly Equities Strategy Update
We see the complaisance for US equities and EPS too high, particularly as analysts and strategists continue to be “late-to-the-plate” on adjusting EPS for the latest swings in the USD. With the USD moving from 88 – 96 within just 5 months, now there is too little recognition by analysts and investors for that embedded USD strength weighing on Q3 and Q4 EPS, which we estimate need to be adjusted due to current USD temporary strength by at least -4 to -6 cents from current full year consensus of 154.
Weekly Currencies & Fixed Income Strategy Update
The USD continued to show short-term momentum signs of rolling over after entering its seasonal period of weakness at the beginning of July
Weekly Equities Strategy Update
We still reommend that investors should reevaluate their current holdings, and pay close attention to the seasonal forces that likely will come into play in the short term. Seasonally, the next period of strength for US, EU and Asian equities comes into play in the month of October.
Weekly Global Equities Strategy Update
US economic focuses this week are on the FOMC announcement on the Fed Fund rate on Wednesday and the July Employment report on Friday. We think for the coming weeks, yields for the 10-Year are capped at the flag’s implied target of 3.14%, the highest level since mid-2011, implying a much faster pace of tightening, how might that affect equities?
Commodities & Currencies Strategy Update
Now, that we are past the middle of the summer, investors should reevaluate their current holdings, and pay close attention to the seasonal forces that likely will come into play in the short term. We are advising investors to invest along the seasonal trends:
Q3 Global Markets Outlook & Investment Strategy
Globally, equities are getting expensive, with US equities currently representing the highest valuation risk, with some tailwind benefits of a weaker USD fading temporarily. For Q3 2018, we see increased risks for investors in the G-10 equities, particularly in global Auto’s, Financials, Banks, Consumer Goods.
Weekly Global Equities Strategy Update
Now for 4 weeks that we have been heeding our clients to reduce global equities
exposure and increase exposure towards US 10-Year Treasuries and towards
commodities and Oil (WTI, we are keeping our $78 high price target for 2018 for now) in particular, to no surprise that the sell-side herd is following our advice slowly but surely and getting increasingly more negative on equities.
Weekly Global Equities Strategy Update
Now, that we are in the middle of May, investors should reevaluate their current
holdings, and pay close attention to the seasonal forces that likely will come into play in the short term. We are advising investors to invest along the seasonal trends
Currencies & Commodities Strategy Update
The CRB Index gained 0.91 points (0.45%) last week. Intermediate trend is Positive. Strength relative to the S&P 500 Index is Positive. $CRB remains above the important level of 200. The $CRB closed above its 20-day MVA. Short-term momentum indicators are mixed.
Weekly Global Equities Strategy Update
Technical pressures were most prominent in late trading on Friday. Although global equity markets already have reached intermediate oversold levels, they have yet to
show signs of bottoming.
Global Fixed Income Strategy Update
Seasonally, April is the last strong month for equity benchmarks, before the “Sell
in May & Go away” period of seasonal weakness for equities occurs,
Weekly Global Equities Strategy Update
Momentum indicators are hinting of further weakness ahead, investors should
get ready for wild swings in this index, particularly this coming week, and
beyond.
2018 Q2 Global Markets Outlook & Investment Strategy
Global economy to advance at 3.8% to 4.1% GDP in 2018, +3.7% in Q2
Global inflation to remain under 5%, US under 2.2%, EU under 2% for all of 2018
US economy to remain on target 2.5% in Q2, consumer driven, partly due to embedded US$ strength continuing to weigh on trade, tourism, FDI
Weekly Global Equities Strategy Update
Technical pressures were most prominent in late trading on Friday. Although global equity markets already have reached intermediate oversold levels, they have yet to
show signs of bottoming.
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.
Weekly Currencies Strategy & Charts
In economic news, US retail sales fell for a third straight month in February as
households cut back on purchases of motor vehicles and other big-ticket items. The
Commerce Department said retail sales fell 0.1% last month against consensus
expectations of a +0.3% monthly rise.
Weekly Global Equities Strategy Update
World equity markets and economic sensitive sectors entered on schedule their
second strongest period of seasonal strength in the year from the beginning of
March to the first week in May. (Strongest period is from mid-October to the first
week in January).
Weekly Global Equities Strategy Update
We see increasing risks for countries such as China,Japan, Germany, France, and Middle Eastern countries easily reduce parts of their over allocated holdings in US bond investments, in the case where they were not winning any compromises from Washington.
Weekly Global Equities Strategy Update
We see any weakness in European equities to provide investors with a buying
opportunity for a seasonal trade in these sectors into spring. Energy and oil
service stocks began showing technical signs of outperformance late last week,
an encouraging technical sign prior to entering their period of seasonal strength.
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 $78 for WTI.
Weekly Global Equities Strategy Update
In the US, US economic news this week is quiet. Focus is on FOMC meeting minutes
following appointment of a new Fed chief. Short term political uncertainties remain,
including North Korean “sabre rattling”, struggling NAFTA negotiations, possibly another shut-down of the US government and increased scrutiny by special council on Russia’s influence on the Presidential election。 Continue reading
Weekly Global Equities Strategy Update
Foreign investors are still tremendously underweight in Japanese equities, both
on a trade weighted and an overall GDP-weighted basis, and we think there is
room for significant further upward momentum in the short-medium term. We
continue advising to use those for long-term asset allocation build-ups to
overweight Japanese equities on a relative basis, as we do see more value in
Japanese equities still at current valuations than in the US.
Weekly Commodities Strategy & Charts
We maintain our global GDP forecasts for 2018 of 3.8%, and hence why we see the price dynamics for commodities in general, but particularly for the oil and energy markets to remain very bullish.
Weekly Global Equities Strategy Update
2017 had been a record year for global equities. And, as we were correctly predicting, foreign equity indices had outperformed the US major indices again substantially, not even currency adjusted, as we also forecasted a decline of the USD by -8% to -10% for 2017. The USD ended up losing -8.5% in 2017.
Weekly Global Equities Strategy Update
We like to reiterate our positive stance on Japanese equities, combined with
partial hedging of the Yen, as the BoJ’s continued easing, and the potential to
drive it lower against major currencies including the US$, 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).
Weekly Commodities Strategy & Charts
We maintain our global GDP forecasts for 2017 of 3.4%, and at 3.8% for 2018, and hence why we see the price dynamics for commodities in general, but particularly for the oil and energy markets to remain very bullish.
Weekly Global Equities Strategy & Charts Update
We continue seeing better value still in Asian and EU stocks, and continue
recommending for investors to overweight equities in both areas relative to US
equities and likely achieve higher returns until year-end 2017 and into Q1 of 2018.
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.
Weekly Commodities Strategy & Charts
We maintain our global GDP forecasts for 2017 of 3.1%, and at 3.3% for 2018, and hence why we see the price dynamics for commodities in general, but particularly for the oil and energy markets to remain very bullish.
Weekly Global Equities Strategy & Charts Update
We clearly see better value still in Asian and EU stocks, and for investors to overweight in both, relative to US equities and achieve higher returns until year-end 2017.
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.
Weekly Commodities Strategy & Charts
For next year, we continue to see developing economies to lead global growth as higher commodity prices and improving fiscal positions will buttress their growth. In particular, the consolidation of the economic recoveries in Brazil and Russia will shore up economic activity in their regions.
Weekly Global Equities Strategy & Charts Update
Medium-term strategic bias on equities continues to show signs of moving onto a less positive path. The latest sentix survey suggests sentiment and investors’ strategic bias on Eurozone equities has firmed. Sentiment for Chinese and Japanese equities, when looking at medium-term strategic bias readings, is still heading higher.
Recommendation updates Allianz AG Continental AG
All in all better than expected Q3 results and another share buyback program, which underlines Allianz’s capital strength and the willingness to return excess capital to shareholders. We raise our TP (3 – 12 months) from EUR 220 to EUR 250/share.
TSLA Update Sell
Today, we are re-iterating our Sell/Short recommendation on TSLA at current levels 0f $321/share maintain our target price for TSLA shares of $215 over the next 6 – 9 months.
Weekly Investment Strategy Update & Charts Update
We clearly see better value still in Asian and EU stocks, and for investors to
overweight in both, relative to US equities and achieve higher returns until yearend
2017.
Deutsche Bank Q3 update BUY 9 mo TP EUR 18
Looking at the chart technical outlook for DB shares, we reiterate our Buy rating with a 9-12 months’ target price of EUR 18. DB shares keep gathering momentum from the September lows.
Weekly Investment Strategy Update & Charts Update
At a market level, investors’ medium-term strategic bias on equities continues to show signs of moving onto a less positive path. The latest sentix survey suggests sentiment and investors’ strategic bias on Eurozone equities has modestly weakened.
General Electric & Co. (NYSE-GE $21.58) Update & Charts Update
However, looking at the total picture for GE shares, It appears to us that investors
might get a good chance to buy GE shares under $20 in the coming weeks until
November 14th, possibly even under $18/share.
102017 CGI General Electric & Co. (NYSE-GE $21.58) Update & Charts Update BUY 12 MO TP $28
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.
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.
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.
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.
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.
Weekly Investment Strategy Update & Charts Update
In the Americas, the US economy is on track to grow at a 3.7% annualized pace in Q3, the Atlanta Federal Reserve’s GDP Now forecast model showed on Friday, following the release of the government’s July payrolls report.
Weekly Investment Strategy Update & Charts Update
We have highlighted since May 5th that signs of a seasonal peak in European and
now also for North American equity markets had arrived. The Euro Stoxx 600, the
DAX and the CAC reached their seasonal peaks on May 13th.
Investment Strategy Update
We continue recommending for investors to reduce equity positions in G-10
markets into the last rally before the summer, as we are forecasting for a -12% to
-15% decline in European and US stocks to materialize.
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.
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
Q2 end target of 1.18, and our 2017 EUR/USD target of 1.18 – 1.20.
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
($TNX), and into EU and EM currencies and equities, which form a tactical Asset
allocation call has been spot on so far in the current quarter.
Weekly Investment Strategy Update & Charts
Europe is emerging as a region that offers a stable investment environment, just as the fate of other economies is harder to predict. The UK is facing complex divorce
negotiations with the EU. There are significant economic downsides from Brexit for the UK. The damage to the EU economy is probably limited, and the impact might well be positive. Especially if companies and financial institutions decide to move to the continent.
Investment Strategy Update & Charts
We continue to see the Euro to stabilize further and continue to rise. Safe heaven
currencies like the US$ 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
Q2 end target of 1.18, and our 2017 EUR/USD target of 1.18 – 1.20.
2017 Q3 Global Markets Outlook & Investment Strategy
Globally, equities are getting expensive, with US equities currently representing the highest valuation risk, as US corporate earnings will be revised downwards, partly due to the continued higher weighted US$ and its negative translational impacts.
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.
Investment Strategy Update
In Europe, IHS Markit’s Eurozone Flash Composite Purchasing Managers’ Index
for May, seen as a good guide to growth, matched the previous month’s 56.8, its
highest since April 2011.
Weekly Investment Strategy Update & Charts
We are seeing increasing signs of a very similar credit bubble in the US as in 2006/2007, and investors should consequently diversify risks by re-allocating more assets outside of the US equities and credit markets.
Weekly Investment Strategy Update & Charts
In the Americas, US retail sales and CPI data released on Friday gave further confirmation that the US economy is slowing.
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.
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
($TNX), and into EU and EM currencies and equities, which form a tactical Asset
allocation call has been spot on so far in the current quarter.
Weekly Investment Strategy & Charts
We see European stocks will likely rally for another short period, until they reach the zenith of annual dividends paid out in mid-May. We recommend for investors to start reducing equity positions into the last rally before the summer, as we are forecasting for a -12% to -15% decline in European and US stocks to materialize once the period of seasonal strength for this asset class will pivot into their strongest period of seasonal weakness from May to October.
US Macro slowing, US$ & US equities Trump Dump
As we have been warning investors for the past 8 weeks, we have highlighted noticeable surface cracks in the US economy, which slowly are impacting how the US$, US bonds and US equities are performing.
Weekly Investment Strategy & Charts
Headline prices in the US, UK and Europe are already at or above 2%. At the same time, seven central banks globally are still running negative interest rate policy (NIRP), while aggregate global quantitative easing continues to expand at breakneck speed. Looking ahead, we think central bank liquidity, the major factor that helped support risky assets during the post-crisis era, might peak by early 2018.
Weekly Investment Strategy & Charts
Looking ahead, we think central bank liquidity, the major factor that helped
support risky assets during the post-crisis era, might peak by early 2018.
Currencies Commentary
The US$ warrants careful attention in the weeks ahead as we transition out of a period of seasonal strength and into a period of weakness.
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.
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)
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.
Weekly Investment Strategy & Charts
Investor sentiment towards emerging market (EM) equities remains closely
linked with views on commodities. It is notable then that optimism on
commodities as a grouping has been tempered in the past month, even as EM
sentiment has headed higher.
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.
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.
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.
Morning Market Commentary & Charts
On the economic front, US Q4 GDP growth was confirmed at its second reading, official data yesterday showed. The Bureau of Economic Analysis confirmed Q4 growth at 1.9%. (Vs. consensus forecast Q4 GDP to be revised upward to 2.1%).
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.
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.
Weekly Market Commentary & Charts
AUD and CAD turn higher, USD weakness is gaining breadth.
Commodities break to the upside (Oil, Copper, Steel, Platinum, Palladium).
Emerging Market equities break out to the upside (Brazil; India; China).
Stock/Bond ratio ready to break higher.
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
Morning Market Commentary & Charts
For the past 3 years we have been highlighting a disturbing and fairly overlooked
fact, namely that investors seem to like hype and hope over reality, particularly
when it comes to comparing investment outlook and opportunities between the
US and Europe, but also by comparing the US to the ROW.
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.
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.
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.
Oil & Energy Market Commentary & Charts
For 2017, we are forecasting that commodities’ prices in general will rise by about 15%, however for Oil prices not by nearly as much as in 2016. We maintain our $67 – $70 high-end price range for WTI for 2017.
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.
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.
Weekly Market Commentary & Charts
2017 seems for most an inherently tricky year to forecast, since the political shift in
power creates so many unknowns. Policy implementation could play a big role in
shaping economic output and corporate profitability, and both of these factors matter
immensely to stock performance.