Yesterday BASF, the largest chemical company in the world, announced its earnings would fall well short of analyst estimates in the second quarter. Earnings season in the US begins in a few weeks. So, we ran through our charts to harvest any insights about how corporate earnings may play out. I’m afraid the results are […]
All eyes will be on the payroll report on Friday for clues about what it means for the Fed’s next move. Indeed, the payroll report will be the most important US economic data point between now and the Fed’s next meeting at the end of July, so the stakes are high and expectations have been […]
To cut or not to cut is no longer the question. Now the question is the quantity, magnitude and timing of rate cuts for the rest of the year. This week was an important one in that we were privy to several important Fed speeches as well as some informative data about the state of […]
Internet retailers are a much-watched sub-industry in the stock market for good reason: worldwide retail ecommerce is predicted to generate double-digit growth each year through 2022, reaching total sales of $3 trillion by the end of that year, according to Euromonitor. For those of us who measure innovation, that makes the internet & direct marketing […]
On Tuesday of this week we wrote about the four possible scenarios the Fed could adopt in their Wednesday policy decision. In order of most hawkish to most dovish, those scenarios were: Fed does not cut rates and signals that a rate cut may be appropriate later in the year (read the September meeting). Balance […]
Tomorrow will obviously be one of the most important news days of the year for financial markets with the Fed expected at the very least to signal that a rate cutting cycle is in the offing. Indeed, since the Fed last raised rates the yield curve has inverted at the important 10Y-3M spread, inflation expectations […]
As expectations for a Fed easing cycle have gained momentum, we’ve seen an abundance of comparisons between the current period and the late 1990s. In that period the Fed cut rates and stocks simultaneously levitated into the stratosphere. If we are to follow the logic that the rate cuts in 1998 caused the stock market […]
In this mid-quarter update, entitled “Escalation,” we discuss the backdrop of escalating trade wars and our belief that the environment is more favorable for US Treasury bonds relative to stocks. The trade war is escalating at a time of weakening global growth, thereby weighing further on growth. The CNY/USD devaluation that began last year is […]
Yesterday we wrote about three macro factors that will act to restrain economic growth through the rest of 2019 and into 2020. Those risks are the baked-in fiscal tightening, the lagged effects of monetary policy tightening, and growth retarding trade policy. Together, they could restrain growth to levels well below expectations and induce a profits […]
As we look into the second half of the year and into 2020, we are left with a fleeting feeling about the prospects for a cyclical uptick in growth and therefore earnings. The problem is not so much with the current pace of growth or incoming data (which by the way hasn’t been very good). […]