Recent Publications

Are Demographic Trends Your Friends? Investing in Millennial and Baby Boom Life Changes

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In this demographic report we take a closer look at the two largest generations as they reach new life stages; millennials entering a more responsible stage of household formation and potentially homeownership, and baby boomers entering a stage of less responsibility and more leisure time in retirement. The report is divided into two sections. First, we give an update on each generation's well-being. Second, we identify investable industries that should have a demographic tailwind from both millennial and baby boom life changes.

Ned Davis Research | U.S. Featured Report | Mixed

LEI Positive For Near-Term Growth

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Philly Fed factory activity up, but outlook continues to weaken. Jobless claims fewest since 1969. Consumer economic optimism highest since 2002. Equipment finance industry confidence slides. Cass Freight indexes point to tighter capacity. Beige Book: Continued growth, but concerns over tariffs.

Ned Davis Research | Economics | Daily Economic Perspectives | Daily

LEI Positive For Near-Term Growth

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Philly Fed factory activity up, but outlook continues to weaken. Jobless claims fewest since 1969. Consumer economic optimism highest since 2002. Equipment finance industry confidence slides. Cass Freight indexes point to tighter capacity. Beige Book: Continued growth, but concerns over tariffs.

Ned Davis Research | Economics | U.S. Daily Perspectives NL | Daily

Market Not Buying Fed's Dot Plot

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The market is too complacent that the Fed will stop after two more rate hikes.

Ned Davis Research | Fixed Income | U.S. Comment | Daily

G7 and BRIC Outlook: Modest Recovery

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We provide our quarterly economic update of the world's major countries and regions. Compared to our last outlook in April, economic conditions have improved or remained stable among most of the world's largest economies. This supports our view of continued global economic growth, but with momentum likely to have peaked at the end of 2017. Inflation pressures have picked up modestly among most countries. As a result, global monetary policy will continue to move toward gradual normalization.

Ned Davis Research | Economics | Global Focus | Monthly

Housing Starts and Permits Decline

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Mortgage applications mixed. Architecture billings weaken.

Ned Davis Research | Economics | Daily Economic Perspectives | Daily

Housing Starts and Permits Decline

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Mortgage applications mixed. Architecture billings weaken.

Ned Davis Research | Economics | U.S. Daily Perspectives NL | Daily

Pick Stocks With Strong Price Momentum

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Price momentum has been one of the top-performing factors this year. Complement momentum by also choosing companies that reward equity shareholders and trade at favorable free cash flow multiples. European stocks with favorable characteristics include: Adidas, Pernod Ricard, Equinor, Repsol, DnB, SAP, Air Liquide, Sky, Tesco, Intl Consolidated Airline, Ferguson.

Ned Davis Research | Stock Selection | Europe Portfolio Strategy | Monthly

Active Passive

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Fund Flows, Ticks and VIX are all helpful in marking short-term overbought or oversold conditions. Passive investments have been quite active this year.

Ned Davis Research | Ned's Insights | Institutional Hotline | 3X Weekly

Plenty of Global Liquidity

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The shrinkage of the Fed's balance sheet is an overblown concern. Although QE would no longer be providing a tailwind, the Fed's removal of QE wouldn't be providing much of a headwind either. Our Global Liquidity Estimate, which combines the balance sheets of the Fed, the ECB, and the BOJ, and foreign exchange reserves, shows 9.9% annual growth in Q1.

Ned Davis Research | Fixed Income | Global Comment | Weekly

Industrial Production Rebounds

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Builder confidence steady. Empire services activity moderates. Weekly retail sales mixed.

Ned Davis Research | Economics | U.S. Daily Perspectives NL | Daily

Industrial Production Rebounds

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Builder confidence steady. Empire services activity moderates. Weekly retail sales mixed.

Ned Davis Research | Economics | Daily Economic Perspectives | Daily

CAPE No Fear. An Alternative Cyclically Adjusted P/E Ratio

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NIPA profits are less volatile than GAAP earnings, potentially improving their usefulness as a long-term valuation metric. The NIPA Shiller P/E has been modestly better than the NIPA P/E in recent years, but a forward/trailing EPS combo has been better. The stock market is expensive based on most P/E ratios.

Ned Davis Research | Equities | U.S. Focus | Monthly

ETFs on the Move Last Week

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Biotech (IBB) and Equal-Weighted Nasdaq 100 ETFs (QQEW & QQQE) broke out to significant new highs last week. U.S. dominance continued with the S&P 500 (SPY), Russell 1000 (IWB), and Russell 3000 (IWV) all breaking out to new all-time highs relative to the MSCI ACWI. Apart from energy funds, commodity weakness was widespread. Precious metal, industrial metal, and agriculture funds all broke to significant new lows last week.

Ned Davis Research | ETF Selection | Highlights | Weekly

Retail Sales Advance At A Solid Pace

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Business inventories rise. But Empire state factory activity and capex plans moderate.

Ned Davis Research | Economics | Daily Economic Perspectives | Daily

Retail Sales Advance At A Solid Pace

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Business inventories rise. But Empire state factory activity and capex plans moderate.

Ned Davis Research | Economics | U.S. Daily Perspectives NL | Daily

Is Turkey Cheap Enough?

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Turkish equity and currency valuations appear historically cheap. Momentum trends remain unfavorable. Despite cheap valuations and overstated political risk, we remain neutral on the market pending momentum improvement.

Ned Davis Research | Equities | Emerging Markets Focus | Monthly

Don't Fight The Tape

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It is often a big mistake to fight "City Hall" or the "Judge and Jury" known in the stock market as "The Tape".

Ned Davis Research | Ned's Insights | Institutional Hotline | 3X Weekly

A Grim Sterling Outlook

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We would reopen short positions in the GBP against both the USD and EUR. Valuations and sentiment favor GBP and EUR against USD, while technicals remain mixed. Political risk remains significant for the GBP in particular, and hedging costs are cheap.

Ned Davis Research | Equities | Europe Focus | Monthly

Consumer Sentiment Slips

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Import prices ease. Budget deficit remains on a widening track. Housing affordability declines.

Ned Davis Research | Economics | Daily Economic Perspectives | Daily

Consumer Sentiment Slips

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Import prices ease. Budget deficit remains on a widening track. Housing affordability declines.

Ned Davis Research | Economics | U.S. Daily Perspectives NL | Daily

Best Region for Gains? Nowhere in a Bear

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If bear develops, regional equity correlations likely to rise, given historical tendencies. All indices and sectors dropped in last two bear markets, bonds gained. U.S. index and Tech sector relatively expensive and could be more vulnerable this time.

Ned Davis Research | Equities | Global Focus | Monthly

Strong Animal Spirits and Net Worth, But No Changes to Income and Spending

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Net worth and crowd psychology have boomed over the last year and a half, but really growth in income, spending, and employment are similar to the prior few years. A look at how the unemployment rate "calls" stock prices longer-term.

Ned Davis Research | Ned's Insights | Institutional Hotline | 3X Weekly

Consumer Price Inflation Trudges Higher

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Consume comfort increases. Jobless claims drop.

Ned Davis Research | Economics | Daily Economic Perspectives | Daily

Consumer Price Inflation Trudges Higher

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Consume comfort increases. Jobless claims drop.

Ned Davis Research | Economics | U.S. Daily Perspectives NL | Daily

Bond Breadth: Powerful New Tools to Add Alpha

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Using bond breadth can add alpha to your performance by helping to identify when it is a good time to take risk in the credit markets.

Ned Davis Research | Fixed Income | Global Focus | Monthly

Key Charts for Consumer Staples

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Watch these four key charts to see if Consumer Staples could outperform beyond the summer months.

Ned Davis Research | Equities | U.S. Sector & Industry Comment | Weekly

Is the Global Economy Signaling the Next Bear Market?

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Despite signs that global economic momentum may have peaked, most of the indicators we watch closely are better positioned now than when global equities topped in 2015.

Ned Davis Research | Economics | Global Comment | Weekly

Is Reducing the Trade Deficit Worth a Trade War? (No)

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A trade war with China has created both potential winners (tech and industrial machinery) and losers (agriculture and autos). But the industry mix of winners and losers will change as the trade war escalates, and could create more losers. Tariffs result in higher inflation, increased uncertainty, and slower capex, employment, and overall economic growth. Tariff revenue is generally insufficient to repair the budget deficit.

Ned Davis Research | Economics | U.S. Focus | Monthly

Producer Price Inflation Accelerates

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Wholesale inventories rise. Mortgage applications mixed.

Ned Davis Research | Economics | U.S. Daily Perspectives NL | Daily

Producer Price Inflation Accelerates

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Wholesale inventories rise. Mortgage applications mixed.

Ned Davis Research | Economics | Daily Economic Perspectives | Daily

June 2018 Sentiment/Valuation Update

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Cyclical sentiment/valuation suggests high risks as stocks expensive and extended, but shorter-term, fund flows suggest oversold.

Ned Davis Research | Ned's Insights | Institutional Hotline | 3X Weekly

What to Watch for a Bearish U.S. Outlook

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Model deterioration shows risks have risen even as the S&P moves to the top end of its trading range. Deterioration has not been enough to remove our positive outlook for U.S. equities on an absolute basis. Within equities, we are lowering beta by removing our underweight to high dividend yielders.

Ned Davis Research | Equities | U.S. Focus | Monthly

JOLTS: Record Number of Quits

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NFIB optimism eases slightly. Weekly retail sales slip.

Ned Davis Research | Economics | Daily Economic Perspectives | Daily

JOLTS: Record Number of Quits

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NFIB optimism eases slightly. Weekly retail sales slip.

Ned Davis Research | Economics | U.S. Daily Perspectives NL | Daily

Upgrading Agency MBS to Marketweight

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Performance has stabilized and supply concerns have faded.

Ned Davis Research | Fixed Income | U.S. Focus | Monthly

Oil: (Re)Balancing Act - Questions for the Second Half

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Record U.S. crude exports mark the next step on the path of oil's rebalancing act. Entering the second half of 2018, we remain oil bulls.

Ned Davis Research | Commodities | Comment | Bi-Weekly

Swapping Chips for Bricks

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Updating NDR tactical recommendations following several significant position changes last week. Closing Invesco Dynamic Semiconductors ETF (PSI) trade in response to tech sector downgrade. Initiating a trade in Invesco KBW Premium Yield Equity REIT ETF (KBWY) with Real Estate being lifted to an overweight. Maintaining iSHARES Edge MSCI USA Momentum (MTUM) recommendation, but watching breadth of the underlying holdings closely.

Ned Davis Research | ETF Selection | Highlights | Weekly

Employment Trends Re-Accelerate

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OECD U.S. CLI steady. Used vehicle prices rise further.

Ned Davis Research | Economics | Daily Economic Perspectives | Daily

Employment Trends Re-Accelerate

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OECD U.S. CLI steady. Used vehicle prices rise further.

Ned Davis Research | Economics | U.S. Daily Perspectives NL | Daily

Oversold, But Lots of Divergent Trends

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Market action is very mixed. A/D Line, NASDAQ, and Russell 2000 bullish while DJIA, DJTA, and Financials questionable. Big Mo mildly bullish.

Ned Davis Research | Ned's Insights | Institutional Hotline | 3X Weekly

Solid Jobs Growth as Tightness Eases

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This report will encourage the Fed to continue along its path of gradual rate hikes and normalizing monetary policy. Trade deficit continues to narrow.

Ned Davis Research | Economics | Daily Economic Perspectives | Daily

Solid Jobs Growth as Tightness Eases

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This report will encourage the Fed to continue along its path of gradual rate hikes and normalizing monetary policy. Trade deficit continues to narrow.

Ned Davis Research | Economics | U.S. Daily Perspectives NL | Daily

A 67 Year Test of What Macro Indicators Work for Long-Term Performance

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I look at 12 macro indicators and their historical returns. The record is mixed at best, but you can decide for yourselves.

Ned Davis Research | Ned's Insights | Institutional Hotline | 3X Weekly

Monthly Sector Update (Shifting Defensive) - July 2018

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Shifting 1000 basis points of allocation from cyclical to defensive sectors. Sector model recommendations, very broad outperformance from defensive sectors in June, and NDR moving equities to marketweight were the impetus to make the moves. In the process, we downgrade Technology to marketweight, Industrials and Materials to underweight, while lifting Consumer Staples and Real Estate to overweight. The moves could be seen as short-term or tactical if it looks like the market is following the typical mid-term election year pattern of being weak until mid-October and then having a strong rally through year-end. However, defensive sector long-term mean reversion trends and a 10-2 yield curve less than 40 basis points from inversion argue that we are late cycle when defensive sector exposure should be maintained.

Ned Davis Research | Equities | U.S. Sector & Industry Focus | Monthly

ISM Services Activity Shows Solid Growth

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Employment indicators reflect tight labor market conditions. Vehicle sales rebound, led by trucks. CEO confidence off modestly. But consumer comfort moves up.

Ned Davis Research | Economics | U.S. Daily Perspectives NL | Daily

ISM Services Activity Shows Solid Growth

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Employment indicators reflect tight labor market conditions. Vehicle sales rebound, led by trucks. CEO confidence off modestly. But consumer comfort moves up.

Ned Davis Research | Economics | Daily Economic Perspectives | Daily

Downgrading Equities to Marketweight - Why Now?

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Downgrading equities from 10% overweight to marketweight. Response to Global Balanced Account Model, Rally Watch report, and concerns about earnings and seasonality. Also shifting regional exposure from Emerging Markets to Canada and from Europe ex. U.K. to U.S.

Ned Davis Research | Equities | Global Focus | Monthly

What's the Best Bond Yield to Use in Determining the Equity Risk Premium?

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Considering the deterioration in corporate credit quality, it is better to use a Baa yield for comparisons with equities. Lower-risk bonds will be even more attractive during periods of financial stress.

Ned Davis Research | Fixed Income | U.S. Comment | Daily

China Indicator Review

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MSCI China technicals are positive, but have shown signs of marginal deterioration. Earnings-related indicators are favorable, on balance. Overall our China-related indicators are constructive, but less so than in March.

Ned Davis Research | Equities | Emerging Markets Focus | Monthly

Factory Orders Rebound

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State leading indexes project stellar growth. NYC services activity off slightly, but outlook strengthens. Weekly retail sales continue to trend up.

Ned Davis Research | Economics | Daily Economic Perspectives | Daily

Factory Orders Rebound

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State leading indexes project stellar growth. NYC services activity off slightly, but outlook strengthens. Weekly retail sales continue to trend up.

Ned Davis Research | Economics | U.S. Daily Perspectives NL | Daily

No More Excuses - Global Growth May Have Seen Its Peak

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Global manufacturing growth eased to an 11-month low, as the risk of a trade war, maturing economic cycles, and the stronger dollar have strained the global picture. Although the peak in momentum may be behind us, the PMI indicators remain far from recession territory.

Ned Davis Research | Economics | Global Comment | Weekly

A 50-Plus Year Test of What Sentiment/Valuation Indicators Work for Long-Term Performance

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I look at 10 sentiment/valuation indicators and their historical returns. Most suggest high risks currently.

Ned Davis Research | Ned's Insights | Institutional Hotline | 3X Weekly

Passive Funds Gaining Ground in Fixed Income

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Like their equity counterparts, bond investors are increasingly using index and ETF products. Active's share has dropped 16 percentage points over the past 15 years.

Ned Davis Research | Fixed Income | U.S. Comment | Daily

Q2 Benchmark Review: America First

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U.S.-related themes like U.S. over emerging markets, small over large, the U.S. dollar, and U.S. high yield outperformed. Growth-related benchmarks and sectors continued to outperform, driven by FAANG stocks. Stocks outperformed bonds each month in Q2.

Ned Davis Research | Equities | U.S. Benchmarks | Quarterly

ETF Model Senses an End to the Soft Patch

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Two indicators shifted from bonds to stocks this month, lifting equity exposure to 72%. Stock allocation remains heavily tilted towards small-caps/tech. U.S. Treasurys account for the majority of fixed income allocation.

Ned Davis Research | ETF Selection | Highlights | Weekly

ISM Manufacturing Shows Strength Amid Slower Deliveries

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Construction spending up slightly.

Ned Davis Research | Economics | U.S. Daily Perspectives NL | Daily

ISM Manufacturing Shows Strength Amid Slower Deliveries

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Construction spending up slightly.

Ned Davis Research | Economics | Daily Economic Perspectives | Daily

Some Global Trend Deterioration

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U.S. trend evidence is neutral but global trend evidence is weaker.

Ned Davis Research | Ned's Insights | Institutional Hotline | 3X Weekly

On Continued Cooling, Watch Earnings Sentiment and Dollar Index

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Market-threatening uptrends in inflation and interest rates less likely than too-cold scenario. But economic slowing increases chances of earnings disappointment in next earnings season. Cooling trend supports prospects for continuation of long-term downtrend in U.S. Dollar Index.

Ned Davis Research | Equities | Global Focus | Monthly

Personal Income and Spending Up, Inflation Hits Fed's Target

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Consumer sentiment eases from mid-month, but trend still up. Regional activity indexes suggest solid growth.

Ned Davis Research | Economics | Daily Economic Perspectives | Daily

Personal Income and Spending Up, Inflation Hits Fed's Target

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Consumer sentiment eases from mid-month, but trend still up. Regional activity indexes suggest solid growth.

Ned Davis Research | Economics | U.S. Daily Perspectives NL | Daily

Mixed Macro Observations

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The soft data looks super on the economy, but rising inflation and interest rates are early warnings Q2 may be the best we see.

Ned Davis Research | Ned's Insights | Institutional Hotline | 3X Weekly

Latin America: Remain Long Mexico; Still too Early for Brazil

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We remain overweight Mexican equities relative to the MSCI EM Index. Despite the correction, we think it too early to buy Brazilian equities. Valuations and technicals, rate dynamics, and politics support current positioning.

Ned Davis Research | Equities | Emerging Markets Focus | Monthly

Q1 Real GDP Growth Revised Down, But Profits Up

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Jobless claims up slightly. Consumer comfort advances. K.C. Fed manufacturing near record high.

Ned Davis Research | Economics | Daily Economic Perspectives | Daily

Q1 Real GDP Growth Revised Down, But Profits Up

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Jobless claims up slightly. Consumer comfort advances. K.C. Fed manufacturing near record high.

Ned Davis Research | Economics | U.S. Daily Perspectives NL | Daily

Reviewing Our NDR Millennial Survey Results

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Here we compare the results of our 2018 NDR Millennial Survey with that of our 2013 survey.

Ned Davis Research | Equities | U.S. Sector & Industry Focus | Monthly

Everything You Need to Know About Every Economy in Literally One Place

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We introduce a master report that organizes in one place, all of our Economic Summary Reports, a one-stop dashboard to measure a country's or region's economic trends. The data confirms the broad-based weakening in momentum observed among several of the world's economies this year. Although we see some tentative signs of turnaround.

Ned Davis Research | Economics | Global Comment | Weekly

The Two Biggest Worries for Long-Term Bond Investors

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With bonds inching closer to a bear market and credit in the latter stages of its cycle, structural shifts in the bond market could have greater impacts on future bond returns than those experienced in past cycles.

Ned Davis Research | Fixed Income | Global Focus | Monthly

State Coincident Indexes Show Near-Zero Odds Of Recession

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Durable goods orders slip. CRE market conditions continue to strengthen. But pending home sales and mortgage applications decline.

Ned Davis Research | Economics | Daily Economic Perspectives | Daily

State Coincident Indexes Show Near-Zero Odds Of Recession

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Durable goods orders slip. CRE market conditions continue to strengthen. But pending home sales and mortgage applications decline.

Ned Davis Research | Economics | U.S. Daily Perspectives NL | Daily

Short- to Intermediate-Term Stock Sentiment Cools a Little

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I look deeper at our short- and intermediate-term sentiment polls and they have come off extreme optimism, but still show clouds for the market.

Ned Davis Research | Ned's Insights | Institutional Hotline | 3X Weekly

Factor Recommendation Changes: Favor Companies with Greater Asset Turnover and Standardized Unexpected EPS

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Replacing Cash Position and EPS Growth/Stability with Asset Turnover and Standardized Unexpected EPS. Favor Companies with the Following Factor Exposures: Standardized Unexpected EPS, Asset Turnover, Free Cash Flow/Enterprise Value, Price Momentum, Earnings Revisions. Stocks Demonstrating These Characteristics Include Booking Holdings, TJX Companies, UnitedHealth, Boeing, Lockheed Martin, Apple, Facebook, Intel, Mastercard, Adobe.

Ned Davis Research | Stock Selection | U.S. Portfolio Strategy | Monthly

Consumer Confidence Slips, But Remains Near Multi-Year High

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Existing home sales continue to climb, Richmond Fed activity accelerates, Texas services activity continues to grow, and weekly retail sales mixed.

Ned Davis Research | Economics | Daily Economic Perspectives | Daily

Consumer Confidence Slips, But Remains Near Multi-Year High

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Existing home sales continue to climb, Richmond Fed activity accelerates, Texas services activity continues to grow, and weekly retail sales mixed.

Ned Davis Research | Economics | U.S. Daily Perspectives NL | Daily

DJIA Changes: No One Likes the New Kid

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WBA's addition makes sense when considering sector contribution and issues with mega-caps. Stocks have outperformed in year after their removal. DJIA's gains have been lower in the year after a change than in the year before. Watch NDR models.

Ned Davis Research | Equities | U.S. Comment | Weekly

A Credit Barbell?

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Although high yield continues to outperform investment grade, AA is outperforming within investment grade, while B and CCC are outperforming within high yield. As a result, we are shifting to favoring AA over BAA. Within high yield, we are moving down a notch to favoring B-rated bonds.

Ned Davis Research | Fixed Income | Global Comment | Weekly

What ETFs Benefit from a Flatter Yield Curve?

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Last week NDR reinstated curve flattening trades. REIT ETFs have the most negative sensitivity to the slope of the curve. Several REIT ETFs broke out to significant new highs last week.

Ned Davis Research | ETF Selection | Highlights | Weekly

New Home Sales Jump New Home Sales Jump New Home Sales Jump

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CFNAI eases, but still indicates steady growth, while Texas manufacturing strengthens.

Ned Davis Research | Economics | U.S. Daily Perspectives NL | Daily

New Home Sales Jump

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CFNAI eases, but still indicates steady growth, while Texas manufacturing strengthens.

Ned Davis Research | Economics | Daily Economic Perspectives | Daily

Dow Theory and Relative Strength Trends Suggest Probable Top Forming

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Trend evidence leans bullish, but there are some warning signs.

Ned Davis Research | Ned's Insights | Institutional Hotline | 3X Weekly

U.S. Markit Flash PMI Eases Amid Stretched Capacity and Tariff Concerns

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The Markit U.S. flash PMI showed private sector growth eased modestly in June.

Ned Davis Research | Economics | Daily Economic Perspectives | Daily

U.S. Markit Flash PMI Eases Amid Stretched Capacity and Tariff Concerns

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The Markit U.S. flash PMI showed private sector growth eased modestly in June.

Ned Davis Research | Economics | U.S. Daily Perspectives NL | Daily

Narrow and Tech-Dependent - Watch Global Breadth

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Narrow advance with Tech outperforming as breadth has weakened. Exposure to the sector has helped U.S. and cap-weighted indices. Watch Tech and U.S. beat rates in future earnings seasons, as both are relatively expensive.

Ned Davis Research | Equities | Global Focus | Monthly

Random Skeptical Macro Thoughts

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I feature a number of indicators that are out-of-line from consensus view. Global economic surprises have been to the downside.

Ned Davis Research | Ned's Insights | Institutional Hotline | 3X Weekly

LEI Still Points to Robust Growth

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Philly Fed factory activity moderates. FHFA house prices post a modest gain. Mortgage apps trend shows weakness. Jobless claims decline. Consumer comfort and expectations up. Equipment finance industry confidence up slightly. Construction backlog eases.

Ned Davis Research | Economics | U.S. Daily Perspectives NL | Daily

LEI Still Points to Robust Growth

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Philly Fed factory activity moderates. FHFA house prices post a modest gain. Mortgage apps trend shows weakness. Jobless claims decline. Consumer comfort and expectations up. Equipment finance industry confidence up slightly. Construction backlog eases.

Ned Davis Research | Economics | Daily Economic Perspectives | Daily

TV Subscriber Wars: The Financial Dark Side

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We remain underweight Media while companies spend heavily to acquire content.

Ned Davis Research | Equities | U.S. Sector & Industry Focus | Monthly

Why We're Staying Away from BTPs

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The end of the APP, politics, and a large debt burden are among the risks of holding Italian bonds longer term. Except for Italy, where we are neutral, we remain overweight European peripheral debt.

Ned Davis Research | Fixed Income | Global Comment | Weekly

Is 2019 the Year You Need to be Worrying About?

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The output gap in the developed world is projected to close this year. More than often, a closed output gap has preceded global recession by about a year. We discuss why this time may or may not be an exception.

Ned Davis Research | Economics | Global Comment | Weekly

Existing Home Sales Slip Again

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Architecture billings improve. Trucking tonnage up. Current account deficit widens.

Ned Davis Research | Economics | Daily Economic Perspectives | Daily

Existing Home Sales Slip Again

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Architecture billings improve. Trucking tonnage up. Current account deficit widens.

Ned Davis Research | Economics | U.S. Daily Perspectives NL | Daily

Three Reasons to Buy the CHF

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We would buy the CHF against the USD with a one- to three-month view. Valuation and sentiment indicators favor the franc. Technical indicators are more equivocal, while political noise is contributing to safe-haven demand.

Ned Davis Research | Equities | Europe Focus | Monthly

Where's The Cash?

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I look at various measures of investor cash and conclude it is lacking in demand potential.

Ned Davis Research | Ned's Insights | Institutional Hotline | 3X Weekly

Factor Changes: Favoring Lower Volatility in Europe

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Europe ex. U.K.: Replace Accruals Ratio with Lower Semivariance. U.K.: Substitute Accruals Ratio and Earnings Revisions with Asset Turnover and Shareholder Yield. European stocks with favorable characteristics include: Adidas, Equinor, Zurich Insurance Group, Schneider Electric, Air Liquide, Telenor, Sky, Tesco, Intl Consolidated Airline, Ferguson, Halma.

Ned Davis Research | Stock Selection | Europe Portfolio Strategy | Monthly

Maybe There is Some Cash on the Sidelines

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iShares Short Treasury Bond ETF (SHV) has the 3rd largest inflows year-to-date. The $6.6 billion in inflows is a 45% increase in total assets. SHV has benefited from correction in stocks and uptick in bond yields. Hard to argue we are at peak euphoria with funds like SHV amongst the top asset gatherers.

Ned Davis Research | ETF Selection | Highlights | Weekly

Housing Starts Soar, But Permits Plunge

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Also, weekly retail sales flat to up.

Ned Davis Research | Economics | Daily Economic Perspectives | Daily

Housing Starts Soar, But Permits Plunge

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Also, weekly retail sales flat to up.

Ned Davis Research | Economics | U.S. Daily Perspectives NL | Daily

Value's Latest Problem

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Interest rates alone cannot fix Value's problems. A new economic or stock market regime is needed for sustained Value outperformance. We are watching for a countertrend Value rally, but NDR models favor Growth currently.

Ned Davis Research | Equities | U.S. Comment | Weekly

Resuming Curve Flattening Trades

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The entire curve is breaking down and all of our models are in the flattening mode. Nevertheless, don't expect to make a lot of money from these trades.

Ned Davis Research | Fixed Income | U.S. Focus | Monthly

Crude Oil - OPEC Meeting Looms

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Heading into this week's OPEC meeting, we expect an agreement that permits an increase in OPEC+ oil production. The current selloff has weakened our short-term technical indicators, but it has corrected the extreme optimism from earlier in the year. For now, the weight of the evidence continues to lean bullish.

Ned Davis Research | Commodities | Comment | Bi-Weekly

NAHB Builder Confidence Eases

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But the Cass Freight Index jumped and Empire services activity rose to decade high.

Ned Davis Research | Economics | U.S. Daily Perspectives NL | Daily

NAHB Builder Confidence Eases

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But the Cass Freight Index jumped and Empire services activity rose to decade high.

Ned Davis Research | Economics | Daily Economic Perspectives | Daily

Fab Five Tape Composite Leans Bullish

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A review of the Fab Five Composite. It leans bullish.

Ned Davis Research | Ned's Insights | Institutional Hotline | 3X Weekly

Industrial Production Down, Due To A Temp Slide In Vehicles

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Empire manufacturing continues to strengthen. Consumer sentiment up.

Ned Davis Research | Economics | Daily Economic Perspectives | Daily

Industrial Production Down, Due To A Temp Slide In Vehicles

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Empire manufacturing continues to strengthen. Consumer sentiment up.

Ned Davis Research | Economics | U.S. Daily Perspectives NL | Daily

Slow but Steady Rise in Inflation Pressures

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I see a slow and steady climb in cyclical inflation.

Ned Davis Research | Ned's Insights | Institutional Hotline | 3X Weekly

Retail Sales Continue to Strengthen in Q2

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Import price inflation up. Business inventories rebound. Jobless claims slide. Consumer comfort jumps.

Ned Davis Research | Economics | U.S. Daily Perspectives NL | Daily

Retail Sales Continue to Strengthen in Q2

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Import price inflation up. Business inventories rebound. Jobless claims slide. Consumer comfort jumps.

Ned Davis Research | Economics | Daily Economic Perspectives | Daily

Amid Second Half Volatility, Watch Risk-On and Risk-Off Indicators

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Watch for more bouts of volatility in second half. Revised Risk-On and Risk-Off indices will help us determine if decline is correction within ongoing advance or the start of cyclical bear market. Indicators support prospects for continuing dollar weakness and gold strength in second half.

Ned Davis Research | Equities | Global Focus | Monthly

Second Half U.S. Sectors Outlook - 2018

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We review our three key sector themes for 2018 and provide a second-half outlook. Our Rising Rate theme keeps us underweight bond-proxy sectors but we are unable to overweight Financials due to a flattening yield curve. We replace our Tax Reform Beneficiary theme with a High Consumer Confidence theme that keeps us focused on Retailing industries leveraged to faster-growing areas of consumer spending. Our Capex Comeback theme is working for Technology, but Industrials has hit a speed bump with slowing momentum in machinery and capital goods.

Ned Davis Research | Equities | U.S. Sector & Industry Focus | Monthly

2H Global Economic Outlook: Expansion Maturing

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The global aggregate economy has staged a modest rebound after a soft patch in Q1, and leading indicators argue for some moderate upside in the coming months. But we're seeing signs that the expansion cycle is maturing. Risks to the global outlook have heightened since the beginning of the year. These include the rising risk of trade war, tighter global monetary policy, emerging market vulnerability, and geopolitical concerns. We reaffirm our forecast for 3.7% global real GDP growth in 2018 assuming these risks don't come into fruition in the near-term.

Ned Davis Research | Economics | Global Focus | Monthly

FOMC Moving Toward Neutral

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The Fed pulled forward its path of expected rate hikes. Policy is not yet neutral but will be relatively soon. Continued rate hikes mean inflation won't get out of hand, and will likely result in a flatter yield curve over the near term. It's premature to call for the end of balance sheet normalization.

Ned Davis Research | Fixed Income | U.S. Comment | Daily

Producer Price Inflation Takes Off

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CFO optimism near record high. OECD U.S. CLI steady, indicates above-trend growth. Budget deficit widens in May. Freight activity strong. Mortgage applications decline.

Ned Davis Research | Economics | Daily Economic Perspectives | Daily

Producer Price Inflation Takes Off

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CFO optimism near record high. OECD U.S. CLI steady, indicates above-trend growth. Budget deficit widens in May. Freight activity strong. Mortgage applications decline.

Ned Davis Research | Economics | U.S. Daily Perspectives NL | Daily

Q1 2018 Quarterly Update - What Does Asset Allocation Tell Us About Long-Term Sentiment?

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Despite the stock market stumble in Q1, most investors fairly fully invested. Nevertheless, extra cash from tax cuts boost corporate buying and that likely continues.

Ned Davis Research | Ned's Insights | Institutional Hotline | 3X Weekly

Upgrading Russia, Downgrading India

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We are upgrading MSCI Russia to overweight relative to the MSCI EM Index with a six- to 12-month view. We are downgrading MSCI India to underweight relative to the MSCI EM Index with a six- to 12-month view. Our ratings reflect a relative assessment of indicator evidence, macroeconomic backdrops, and the political and policy dimension in both countries.

Ned Davis Research | Equities | Emerging Markets Focus | Monthly

Has the Correction Fixed the Valuation Problem?

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Forward and trailing P/Es have returned to pre-election levels. Valuations were elevated before the election. Focus on earnings acceleration instead of trailing or forward earnings growth rates.

Ned Davis Research | Equities | U.S. Comment | Weekly

Risks to the U.S. Economic Outlook in 2H 2018

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Despite a relatively soft start of the year, economic data so far in Q2 show the U.S. economy has regained strength. We continue to project 2.9% real GDP growth for the year. But we do see notable risks to the outlook related to trade policy issues, the U.S. dollar value, worker compensation growth, Fed policy, oil prices, and stock market performance.

Ned Davis Research | Economics | U.S. Focus | Monthly

CPI Inflation Strengthens

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NFIB small business optimism near record high. Manpower employment outlook remains strong. Weekly retail sales mixed.

Ned Davis Research | Economics | Daily Economic Perspectives | Daily

CPI Inflation Strengthens

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NFIB small business optimism near record high. Manpower employment outlook remains strong. Weekly retail sales mixed.

Ned Davis Research | Economics | U.S. Daily Perspectives NL | Daily

Global Reflation Trade On-Track

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A couple of commodity indexes have already broken out to the upside, and a couple of more are close to doing so. If they do, that should keep global bond markets on the defensive.

Ned Davis Research | Fixed Income | Global Comment | Weekly

Risk Appetite Returns Just in Time for Most Important Week of the Year

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Short-term sentiment at 4.5-year high. U.S. relative strength at all-time high. Mid-month readings from ETF Model agree, with equity allocation increasing and international exposure eliminated.

Ned Davis Research | ETF Selection | Highlights | Weekly

Was I Too Correct For My Own Good?

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Algorithms (computer trading) dominates a lot of daily action, but cyclical trend evidence, which leans bullish, should not be impacted.

Ned Davis Research | Ned's Insights | Institutional Hotline | 3X Weekly

Wholesale Inventories Up Slightly

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Housing affordability slides.

Ned Davis Research | Economics | U.S. Daily Perspectives NL | Daily

Wholesale Inventories Up Slightly

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Housing affordability slides.

Ned Davis Research | Economics | Daily Economic Perspectives | Daily

Q1 2018 Quarterly Debt and Savings Update

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Financial and mortgage debt down from 2007 relative to economy, but other debt, particularly Government debt, much higher than before the 2008-2009 debt crisis.

Ned Davis Research | Ned's Insights | Institutional Hotline | 3X Weekly

Inflation Expectations, Reflation-Driven Advance

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Model supports 5% shift from bonds to cash, with ongoing stock market advance. Cash upgrade supported by global reflation, rising inflation expectations, and their inverse correlation with bonds. Reflation proxies and inflation expectations have maintained uptrends since cyclical bull started, evident in positive correlation with equities.

Ned Davis Research | Equities | Global Focus | Monthly

Monthly Sector Update - June 2018

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Near-term, softer economic data could cause rates to pause and Growth and bond-proxy sectors to outperform. Longer-term, we maintain conviction in our rising rate and capex comeback themes.

Ned Davis Research | Equities | U.S. Sector & Industry Focus | Monthly

CEO Optimism Eases on Trade Worries

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Consumer comfort off slightly. Jobless claims continue to show tight labor market. Used vehicle prices up. Services revenues advance.

Ned Davis Research | Economics | U.S. Daily Perspectives NL | Daily

CEO Optimism Eases on Trade Worries

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Consumer comfort off slightly. Jobless claims continue to show tight labor market. Used vehicle prices up. Services revenues advance.

Ned Davis Research | Economics | Daily Economic Perspectives | Daily

Why High Yield Investors Should Care about Small-Cap Stocks

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Small-cap stocks and the small-cap Advance/Decline Line are making new highs, indicating an appetite for risk. Small-cap stocks have been an excellent indicator for high yield bonds. We remain overweight credit and high yield.

Ned Davis Research | Fixed Income | U.S. Comment | Daily

Are Concerns Over Italy and Spain Overblown?

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Despite all the recent political turmoil in Italy and Spain, our Eurozone Breakup Index has shown a lower risk of disintegration. We discuss why.

Ned Davis Research | Economics | Global Comment | Weekly

Trade Deficit Narrows Further

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Nonfarm productivity revised down. Mortgage applications up.

Ned Davis Research | Economics | Daily Economic Perspectives | Daily

Trade Deficit Narrows Further

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Nonfarm productivity revised down. Mortgage applications up.

Ned Davis Research | Economics | U.S. Daily Perspectives NL | Daily

Despite Supposedly Surging Earnings, Valuations Remain a Concern

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Stocks are overvalued and profits may be weaker than they seem.

Ned Davis Research | Ned's Insights | Institutional Hotline | 3X Weekly

ISM Services Activity Rebounds

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State leading indexes point to broad-based expansion. JOLTS show record job openings. Weekly retail sales mixed.

Ned Davis Research | Economics | U.S. Daily Perspectives NL | Daily

ISM Services Activity Rebounds

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State leading indexes point to broad-based expansion. JOLTS show record job openings. Weekly retail sales mixed.

Ned Davis Research | Economics | Daily Economic Perspectives | Daily

Tightest Labor Markets Since 1969 Starting to Pressure Compensation

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Several indicators show the tightest labor markets in nearly 50 years. AHE is a flawed indicator. We much prefer using the ECI. Our NAIRU indicator is on the cusp of indicating higher inflation.

Ned Davis Research | Economics | U.S. Comment | Weekly

Three Factors Favoring Spain Over Italy

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While the Scorecard favors Italy, several other factors favor Spain. Banking sector exposures and expectations favor Spain over Italy. Political dynamics also appear more benign in Spain.

Ned Davis Research | Equities | Europe Focus | Monthly

Second Half U.S. Equity Outlook

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Concerns for the second half include EPS momentum, interest rates, the lack of pessimism, and nonexistent breadth thrusts. Models remain bullish amid long-term trend and economic fundamentals. S&P yearend target raised to 2900.

Ned Davis Research | Equities | U.S. Focus | Monthly

Oil: Are the Winds Shifting?

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OPEC rumors have caused hedge funds to close out long positions. After adjusting for term structure effects, current hedge fund positioning no longer appears extreme. However, recent inventory reports have been neutral to slightly bearish.

Ned Davis Research | Commodities | Comment | Bi-Weekly

Several Key Equity Themes Continued Last Week

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A diverse set of U.S. equity funds made all-time highs last week. They all had limited exposure to large-cap Value stocks. European equities continue to breakdown. Europe weakness shouldn't derail the bull market globally. After a strong start to the year, Latin American stocks continued their Q2 decline.

Ned Davis Research | ETF Selection | Highlights | Weekly

Employment Trends Index Edges Down

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Also, factory orders fall and NYC services activity slows.

Ned Davis Research | Economics | Daily Economic Perspectives | Daily

Employment Trends Index Edges Down

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Also, factory orders fall and NYC services activity slows.

Ned Davis Research | Economics | U.S. Daily Perspectives NL | Daily

Downgrading EM Bonds to Marketweight

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Continued strength in the USD, ongoing trade tensions, and weaker oil prices have done sufficient technical damage. Reducing our exposure seems like the prudent thing to do.

Ned Davis Research | Fixed Income | Global Comment | Weekly

Global Economic Growth Continues to Slow

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Global manufacturing momentum cooled to a nine-month low in May, but remains at historically strong levels. Although most economies saw slower growth, sustained strong readings in the U.S. and China, the world's two largest economies, support a continuation of the global expansion.

Ned Davis Research | Economics | Global Comment | Weekly

Goldilocks and the Three Bears

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Trend evidence neutral to bullish, but some other models, which include externals are cautious.

Ned Davis Research | Ned's Insights | Institutional Hotline | 3X Weekly

Widespread Rebounds in Labor, Manufacturing, and Construction Data

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Broad-abased improvements. Capacity tight, inventories lean, backlogs grow, and delivery times lengthen.

Ned Davis Research | Economics | Daily Economic Perspectives | Daily

Widespread Rebounds in Labor, Manufacturing, and Construction Data

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Broad-abased improvements. Capacity tight, inventories lean, backlogs grow, and delivery times lengthen.

Ned Davis Research | Economics | U.S. Daily Perspectives NL | Daily

Update on Some Interest Rate Sensitive Groups

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Some interest rate sensitive groups like homebuilding and REITS in downtrends, but not impacting market overall.

Ned Davis Research | Ned's Insights | Institutional Hotline | 3X Weekly

Volatility, Italy, and the U.S. - A More Likely Catalyst for Catastrophe

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We continue to underweight Europe within U.S.-supported bull market. Watch future earnings seasons, interest rate correlations and sector leadership trends. Worsening U.S. performance would be global bear market warning.

Ned Davis Research | Equities | Global Focus | Monthly

What's Up with Retail?

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Even though Internet & Direct Marketing Retail is driving sector outperformance, retailing breadth has improved in Q2. Implications are that: 1) negative sentiment could continue to reverse for brick-and-mortar retailers, especially those serving high-end consumers; and 2) we may have to consider upgrading a Retailing industry outside of Internet & Direct Marketing Retail if positive spending trends persist.

Ned Davis Research | Equities | U.S. Sector & Industry Comment | Weekly

Consumer Spending and Income Grow

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Layoff trends reflect tight labor market. Beige Book: Moderate growth with limited price pressures. Regional factory activity strengthens. Consumer comfort flat. Pending home sales decline.

Ned Davis Research | Economics | Daily Economic Perspectives | Daily

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