High expectations for earnings season

Mid-week market update: As the market enters into Q2 earnings season, FactSet reported that consensus estimates are calling for an astounding 63.3% YoY EPS growth.     While that growth estimate appears to be a high bar, investors have to keep in mind the low base effect. As well, the historical record shows that actual...

Respect the uptrend

Preface: Explaining our market timing models  We maintain several market timing models, each with differing time horizons. The "Ultimate Market Timing Model" is a long-term market timing model based on the research outlined in our post, Building the ultimate market timing model. This model tends to generate only a handful of signals each decade.   The Trend...

Seven reasons to fade the growth scare

It is astonishing to see the market narrative shift in the space of only a few months from "inflation is coming" to a growth scare. In late March, the 10-year Treasury yield topped at over 1.7% and the 2s10s yield curve was steepening. Today, the 10-year has decisively broken support and the yield curve is...

U-S-A! U-S-A! But for how long?

Mid-week market update: The US markets have surged recently relative to global equity markets, as measured by MSCI All-Country World Index (ACWI). Developed markets (EAFE) and emerging markets (EM) have weakened on a relative basis.     How long can this last? The S&P 500 is testing an important resistance level that could lead to...

The resiliency of the S&P 500

Preface: Explaining our market timing models  We maintain several market timing models, each with differing time horizons. The "Ultimate Market Timing Model" is a long-term market timing model based on the research outlined in our post, Building the ultimate market timing model. This model tends to generate only a handful of signals each decade.   The Trend...