In the most recent FOMC meeting, the committee decided to refrain from raising rates again, but held open the prospect for further hikes this year.
The Bank of Japan met last night to cap off a week of central bank activity.
EnerSys is a leader in stored energy solutions. Based in Reading, Pennsylvania, this company makes batteries, chargers, and accessories for transportation, aerospace, and defense.
Honeywell International Inc. is a global leader in diversified technology and manufacturing. As sectors like aerospace and construction undergo rapid changes, there’s a demand for solutions that boost efficiency while prioritizing safety.
With the rapid pace of urbanization, there’s an increasing demand for efficient and sustainable power solutions, and ABB’s advancements in smart grids and renewable energy integration are pivotal in meeting the demands of this transition.
Known as “onsemi” for short, this Knowledge Leader is a global leader in intelligent power and sensing solutions for industries ranging from automotive to industrial, and from 5G & cloud power to medical solutions.
With government stimulus over, accumulated savings starting to become depleted, rents soaring, and student loans about to switch back on, it appears a credit cycle has begun where borrowers struggle to fulfill their financial commitments.
Xylem is a leading innovator of water solutions. This Knowledge Leader harnesses smart technology to provide water, wastewater, and energy solutions to a diverse range of sectors, from agriculture and aquaculture to commercial buildings and energy.
Today the monthly Job Openings and Labor Turnover survey came out for the month of July. Expectations were for 9.5 million job openings, but the actual figure came in at 8.87 million, representing the biggest miss in recent history.
As the demand for faster, smaller, and more efficient electronic devices grows, so does the need for advanced semiconductor manufacturing techniques. Traditional methods have their limitations, and ASML’s mission revolves around transcending these boundaries.
Today was a disaster for Chinese economic data. In the table below, we can see that every single data point missed consensus expectations in the wrong direction. Activity undershot expectations across the board.
Alphabet Inc., the umbrella organization encompassing Google, is a global conglomerate that has revolutionized the world by organizing information and making it universally accessible and beneficial.
This Knowledge Leader has been instrumental in revolutionizing today’s technology landscape in a range of areas from enhancing graphics for immersive gaming experiences to turbocharging scientific research and steering the future of autonomous vehicles.
This Knowledge Leader aims to provide solutions that can help societies overcome complex challenges. For example, NEC makes biometric identification systems, video analytics systems, and digital government solutions designed to improve the efficiency and transparency of government operations.
Amazon is the world’s largest online retailer and a prominent player in the field of cloud services, digital streaming, and artificial intelligence. This Knowledge Leader has redefined the landscape of e-commerce and technology.
Nokia Corporation is a global leader in networking. Based in Espoo, Finland, this Knowledge Leader’s mission is to bring together the world’s people, machines, and devices to realize the potential of digital in every industry.
Tech giant Microsoft is on a mission to use technology to solve some of the world’s most pressing problems.
In our Quarterly Strategy Update, we explore the changes that have been occurring in Japan and why we hold a favorable investment stance toward Japanese equities in the Knowledge Leaders Strategies.
The Bank of England surprised market participants yesterday morning when they raised the Official Bank Rate by a full half point to 5.00%. The move caught traders off guard as the BOE had chosen to raise rates by only a quarter percentage point at each of the two meetings prior.
After yesterday’s testimony by Fed Chair Jerome Powell to the US House of Representatives I analyzed its sentiment on key issues compared to his previous four FOMC policy statements, using ChatGPT. The table below shows the results.
Today the minutes of the April 27-28, 2023, Bank of Japan meeting were released. Below in italics are the top ten highlights generated by our AI engine.
To recap, we tested the following metrics, drawn from each company’s fiscal year-end reports and stated in USD, and correlated them with the percent price return in local currency over the past five years.
While the Euro Area reported inflation of 6.1% in May, the US was able to post 6% year-over-year as of February. In this framework, a hike, and potentially two more to follow, was to be expected before a pause could occur.
Going into the Fed meeting today it seemed like the consensus was toward a skip, pause, or possibly a full-on stop in raising interest rates going forward. Indeed, there are reasons to be optimistic about inflation coming down despite currently sticky “core numbers.”
Using our AI engine, we prompted a description of the Atlanta Fed’s Flexible CPI. What we got was a pretty decent explanation.
The Euro Stoxx 50 Index is up about 13% year-to-date. Not a bad return for a region whose largest economy is in recession, and whose second largest is facing one of the worst inflation fights in decades.
Investor activism in Japanese companies has been the subject of a fair amount of recent conjecture. Specifically, foreign investors have been concerned about the relative prevalence of minority interest, the ghosts of fading Keiretsus on Japanese companies’ financial statements.
Of course, over 300,000 people getting new jobs is good in itself, particularly for those with newfound opportunities. But, for the last several years, as the “great resignation” took hold, there were not many new workers coming into the workforce, leading to falling unemployment.
Two weeks ago, we noted that Congress would soon raise the debt ceiling, but that this could set up unexpected consequences for investors. Now that the debt ceiling is raised until 2025, the US Treasury is free to fund the government’s liabilities since January.
In the United States, Core PCE Inflation is still 5.0% after a recent reversal in disinflation. This measure is followed by the Fed and excludes volatile food and energy inflation.
Leading into the weekend, when the debt ceiling had not been settled, markets were exhibiting very interesting positioning.
In 2011, markets were relatively flat during the year before Congress and the White House (temporarily) buried the hatchet with the passage of the Budget Control Act on August 2, 2011.
One metric I look at fairly often for various countries is the relationship between the performance of stocks vs. bonds. The idea is straightforward enough: when stocks are outperforming bonds, it tends to be associated with a growing economy.
Credit conditions are tightening in both Europe and the United States. Our analysis follows in our mid-quarter update, Tightening Credit.
It would appear that the decline in European natural gas prices has contributed to an increase in Eurozone GDP estimates for the year. Once prices crossed below $50, GDP estimates began to rise, and now the consensus expects .6% GDP growth from the Eurozone this year.
China reported year-over-year inflation last night at just 0.1%, 0.2% lower than expectations. Clearly, China’s reopening is not creating price pressures, which brings the strength of the reopening into question.
Yesterday JP Morgan introduced a new model to quantify the last 20 years of Federal Reserve statements and speeches. While we aren’t privy to the details of the AI model, we will just assume that the model properly captures dovish and hawkish language.
The University of Michigan’s Consumer Sentiment Survey will give us more information on US consumers’ inflation expectations. The survey respondents’ inflation expectations, as other analysts have pointed out, are highly correlated with gasoline prices, which rose in March by 3.7%.
With the European Market’s earning season fully upon us, let’s look at expectations for the month ahead. According to our proprietary analytics, the European energy and real estate sectors have experienced the highest level of downward revision to sales of all sectors on both a one- and three-month basis.
While Asian financial companies have by no means been safe from the recent banking turmoil scything through other developed economies, regional banks have had a far less punishing month in terms of sales and earnings estimates than their peers in other markets.
This week as regional banks start reporting earnings we will get a better look at the lasting effects of the bank crisis kicked off by the failure of Silicon Valley Bank last month. Looking at recent earnings forecast revisions, regional banks appear particularly exposed to short- and longer-term headwinds.
The Fed’s concern about U.S. banks dominated last month’s FOMC meeting. According to today’s release of the March 21-22 meeting minutes, the Fed was apparently so concerned over banking problems and the potential for an ensuing credit crunch that officials tempered calls for rate hikes...
Lost in the Good Friday holiday and the jobs report was the weekly report on bank lending, deposits and securities holdings. Keeping in mind this data is always a week old, it shows the retreat from banks continues.
As banks back away from credit creation, we think certain assets could reassert their leadership. In our Quarterly Strategy Report, we analyze the Credit Crunch.
The failures of Silvergate Bank, Silicon Valley Bank, Signature Bank, and the current struggles of First Republic and Pacific Western Bank have seen bank deposits flee to the perceived safety of large banks.
The Federal Reserve’s balance sheet grew by $394B in the past two weeks.
Yields on 10-Year Japanese Government Bonds have fallen by about a third over the past two weeks, as shown in the chart below.
To shore up Silicon Valley Bank and the other failed banks, the Federal Reserve extended an open-ended line of credit via its Bank Term Funding Program (BTFP) and discount window borrowings.
Credit Suisse’s problems revealed today stem from issues the company discussed last June in a profit warning.
