The equity market is back to the 2019 level on an inflation-adjusted basis. However, it is still not cheap as it is not pricing in the possibility of a prolonged and deep earnings recession or a higher interest rates regime. Many…
Executive Summary Analysts Have Little Confidence In Their Forecasts In the front section of the sector chart pack, we conduct cross-sectional comparisons. Profitability: Earnings expectations for the cyclical sectors are…
Executive Summary The Fed will continue to hike rates at a time when global trade is contracting. Earlier this week, Fed Chairman Jerome Powell reiterated that the Fed will not hesitate to hike rates until core consumer price…
Today we upgrade the S&P Metals & Mining industry from underweight to neutral: This industry is one of the few beneficiaries of the war in Ukraine, as the military action and global sanctions take offline copious amounts of metals…
Executive Summary Ebbing Stagflation Fear Will Prompt Rerating European inflation will rise further before peaking this summer. Core CPI will reach between 2.8% and 3.2% by year-end before receding. The combination of…
Executive Summary Macroeconomic Backdrop Favors Defensive Consumer Staples Markets now expect five-to-six rate hikes in 2022 The rate of change in rates as opposed to their level has triggered the fast and furious…
Highlights The bond market assumes that when recent inflation has been high, it will be higher than average for the next ten years. Yet the reality is the exact opposite. High inflation is followed by lower than average inflation.…
Highlights There is a high risk of a global demand shortfall in 2022. This is because consumer demand for services will remain well below its pre-pandemic trend… …while the recent booming demand for goods is crashing…