Technical

Highlights Key Portfolio Highlights Improved world economic growth and rising inflation expectations have buoyed global equities (Chart 1). The downside is that financial conditions are tightening and U.S. dollar-based liquidity is contracting, which is…

Highlights The USD bull case is now well known by the market, but this is not strong enough a hurdle to end the dollar's run. The behavior of positioning, the U.S. basic balance of payments, interest rate expectations, and relative central bank balance…

Highlights Portfolio Strategy Food price deflation bodes well for increased volumes, and by extension, packaging stocks. Upgrade to overweight. Prospects for intensifying market and economic volatility argue for reestablishing a portfolio hedge in gold…

Highlights Signing executive orders and memoranda post-Inauguration is a common tactic for new presidents. Unfortunately for investors, political rhetoric has caused uncertainty to surge, while actions affecting profitability have been minimal. The…

Highlights Portfolio Strategy Pricing power has improved across a number of industries, with the exception of technology, a necessary development to sustain an overall profit recovery. The S&P railroads index has surged to the point where it will…

Highlights The DXY correction has a bit more to run as G10 economic surprises are likely to roll over. EM-related plays like commodity currencies can rally for a few more months, but the outlook for 2017 is troublesome. China is at risk of a…

The Tactical Asset Allocation model can provide investment recommendations which diverge from those outlined in our regular weekly publications. The model has a much shorter investment horizon - namely, one month - and thus attempts to capture very tactical…

Highlights Portfolio Strategy Media stocks are poised to challenge previous relative performance highs as sales growth reaccelerates. Stay overweight. The materials sector has lagged behind the commodity price rally, a sign of underlying weakness rather…

Highlights Global Growth: If global demand follows the recent improvements seen in economic sentiment, growth will surprise positively relatively to expectations in 2017. With global inflation also likely to continue drifting higher over the course of the…

Highlights Portfolio Strategy The elevated ratio of market cap-to-GDP discounts strong growth far into the future, suggesting that a market validation phase may be lurking. Capital markets-sensitive stocks have had a good run, but the six month outlook…