Guild’s Basic Needs Index
Chinese Domestic Stocks Get A Boost From Global Indexer
Last year, MSCI — the company that constructs the indexes underlying many major ETFs and benchmarks — began to incorporate some domestically traded Chinese stocks into those indexes. These stocks, called “A shares” to distinguish them from other classes of Chinese shares that trade on exchanges outside the mainland, had
Copper’s Rally
Several base metals have rallied strongly in 2019: as of this writing, copper, nickel, and zinc are all up more than 10%. Copper — the “red metal” — is often referred to as “Dr Copper” because of its alleged status as a leading economic indicator. It is the leading industrial
Market Summary for the Week of February 22, 2019
Market Summary for Week of February 22, 2019 This week we are keeping it short. We remain bullish on the U.S., and on several foreign markets. The U.S. market is still a buy, in our opinion. Breakouts of the type we have recently seen offer opportunity for higher U.S. stock
Is It Time To Buy China?
Getting Bullish on China After a dismal 2018, the Chinese stock market has been one of the world’s better performers in 2019, with the MSCI China index up almost 13% as of this writing. Source: Bloomberg LLP As we have noted in several recent letters, the poor performance of the
Market Summary For the week ending February 15, 2019
The U.S. Economy and Markets In spite of slight deceleration from the GDP growth rate posted in 2018, the U.S. economy continues to be strong, and we anticipate that as 2019 unfolds, growth will strengthen. U.S. markets have rapidly recovered from their fourth-quarter swoon, and while we believe that
Morgan Stanley Goes Where the Money Is
Morgan Stanley [NYSE: MS] is acquiring a Canadian firm, Solium Capital, which manages stock-compensation plans for about 3,000 companies. Collectively, Solium’s clients have a million employees — disproportionately young, and disproportionately employed in high-tech, high-growth startup companies (including, for example, Nextdoor, Sonos, Dropbox, Stripe, and Instacart). This acquisition makes sense
Brazilian Politics Is Changing — And It’s Not Just A New President
Brazil’s 81-seat senate just elected a new leader. (The “president of the senate” is third in line to Brazil’s presidency.) It was not the old leader, who had served four two-year terms in the role: a well-known deal-maker who, like many establishment politicians in Brazil, is facing allegations of corruption.
Some GDP Deceleration, But U.S. Corporates and Consumers Are Still In Good Health
Some GDP Deceleration, But U.S. Corporates and Consumers Are Still In Good Health The partial government shutdown in early 2019 has delayed the Commerce Department’s official report on fourth-quarter U.S. GDP growth until February 28. In the absence of official data, polls of economists are providing some picture: about 2.6% annualized
Chinese Banks Get Creative
China’s fourth-largest bank, the Bank of China (not to be confused with the state bank, the People’s Bank of China) issued $6 billion worth of perpetual bonds in late January. A “perpetual bond” is a bond with no maturity date; that is, it simply pays an income stream forever. The
Railroad Earnings Calls Suggest the U.S. Is Doing Fine
Executives at two of the big U.S. railroad companies, CSX [NYSE: CSX] and Union Pacific [NYSE: UNP] report that growing shipment volumes lead them to feel optimistic about the growth of the U.S. economy. (CSX reported on January 16, and UNP on January 24.) Railroads are often considered a bellwether
Market Summary for the week ending February 1st, 2019.
Market Summary The U.S. Economy and Stock Market The U.S. economy continues to move ahead as do the U.S. stock market and U.S. corporate profits, which as we all know, lead the outlook for stocks. Most agree that the growth rate of the economy will slow in 2019, after the
Chinese Economic Statistics: Why You Shouldn’t Trust Them, and What You Should Watch Instead
Here is another note in our ongoing series of articles addressing China’s economic situation. Many times in the past, we have pointed out that official Chinese economic statistics can mislead analysts, and we suspect that we’re about to see a manifestation of that problem. Here’s why. At the beginning of
Market Summary for the Week of January 25, 2019.
The U.S. Market and Economy The U.S. economy is strong, although slowing from the very rapid growth of 2018. For 2019, we anticipate economic growth of 2.3% before inflation and 4.1% after inflation. U.S. stocks are in a volatile state with slow appreciation toward a rising market overall for 2019.
China Slowdown Means the End of “Policy Tightening” From Asian Central Banks
The Chinese growth slowdown that we’ve commented on in recent letters — which was underway well before the beginning of escalated trade tensions last year — will probably lead regional central banks to ease, or to remain steady rather than tightening monetary conditions in 2019. While China has done some
