Highlights Several economic and financial market indicators point to a budding downtrend in Chinese capital spending and its industrial sector. The recent underperformance of global mining, chemicals and machinery/industrials…

Overweight Since the beginning of February, the S&P air freight & logistics group has been waylaid by reports that Amazon was exploring its own logistics network. This is not new news; in fact, we wrote about this the last time…

Overweight – High Conviction Last autumn, we started to articulate the synchronized global capital spending macro theme that, despite still flying under the radar, will likely dominate this year. This capex upcycle is…

Highlights Portfolio Strategy Synchronized global capex growth and higher interest rates are two key themes that will continue to dominate this year. Three high-conviction calls are levered to the former theme and two to the latter. A…

Overweight The U.S. defense complex has seen a solid recovery in orders over the last three years (second panel), a notable feat because of the absence of a major conflict driving domestic orders. In fact in the past decade, domestic…

Highlights The German 10-year bund yield rising to 1%, or the U.S. 10-year T-bond yield rising to 3% would be a trigger to downgrade equities and upgrade bonds... ...especially as the blue sky expectations for global growth in H1 2018…

Neutral In yesterday’s Weekly Report, we outlined that the most cyclical parts of the S&P industrials index with high foreign sales content would benefit disproportionately from our stable-to-mildly sanguine EM/China view.…

Highlights Portfolio Strategy A stable China, a depreciating U.S. dollar, rising commodity prices and sustained synchronized global growth signal that the industrials complex, especially the most cyclical part, remains on a solid…

Underweight United Airlines spooked the market this week when they announced their plans to grow capacity by 4-6% per year until 2020; the stock fell by 11% that day and took the S&P airlines index down with it. Capacity additions…

Highlights Trade #1: Go Short The December 2018 Fed Funds Futures Contract. The trade has gained 64 bps since we initiated it. We are lifting the stop to 60 bps and targeting a profit of 75 bps. Trade #2: Go Long Global Industrial…