Published May 23, 2025
Investors continue to face all kinds of uncertainty as markets adjust to the Trump Administration’s policies. This week saw the 30-year Treasury bond push past a 5% yield for the first time since October 2023. Then, rates fell back just as quickly. This time, there seems to be more impetus behind the move. But time will tell. (more…)
Published December 27, 2024
Last week we offered Schwab’s 2025 outlook. This week we pursue a bit of a different input. The outlook below is an excerpt from JP Morgan’s Private Banking unit. This type of outlook is more focused on broad economic and industry trends. We hope you find it interesting. (more…)
Published May 10, 2024
Just before the Great Financial Crisis (GFC), Emerging Markets went on one last tear ripping higher by +12% in October 2007. That move capped a near 5x rally of the group over a 5-year period as China embarked on a massive build out. The Emerging Markets ETF (symbol: EEM) closed that October 2007 at a price of $39.32 per share. That same ETF opened 2024 at $39.83 – virtually no gain whatsoever in sixteen YEARS!
In 2020 as markets raced higher despite Covid restrictions and dislocations, Emerging Markets looked like they had finally found a new rally. But, as has been the case repeatedly over the past decade and a half, it was all quickly undone.
Emerging Markets have historically been highly correlated with commodities and with the fortunes of Chinese stocks. China is now trading near its post-GFC lows with pessimism about the Chinese economy running rampant. (more…)
Published January 6, 2023
After the dot.com market crash of 2000-2002, international stocks went on to outperform U.S. stocks until the 2008 Great Financial Crisis. That rise was driven by two factors: 1) the “buildout” of China which pushed any and all commodity-related stocks (e.g. industrials, materials thus emerging markets) higher, and 2) the decline in the dot.com darlings which had become outrageously priced.
It usually happens that the leader of the market in one cycle becomes the laggard in the next as the excess is worked off. So it was post-2002 as the chart below shows with the black line highlighting the period where international stocks outperformed. (more…)
Published November 27, 2020
Our recent articles have described the market’s sudden shift toward value/cyclical market sectors, like energy and financials, and away from the prior market leaders, namely the tech/consumer FANGMA stocks (e.g. FANGMA = Facebook, Amazon, Netflix, Google (Alphabet), Microsoft, Apple). The article below from Delta Research makes the case for a similar shift in market leadership toward non-U.S. markets. (more…)
Published August 28, 2020
The article below from Delta Investment points to the gathering economic and market strength internationally. As noted before, a broader market is a stronger market. The more sectors and markets participate in the market’s rise, the better. For now, our favored Nasdaq index (QQQ) continues to lead the way, powered by the FANGMA trade. (more…)
Published June 29, 2018
International and emerging market stocks have displayed disturbing action recently, failing to hold support, giving up a two-year rally, and accelerating a notable downtrend. The chart below highlights the crossover of the 50 and 200-day moving averages. We see on the left side of the chart the circle and line highlighting the prior crossover for emerging markets back in mid-2015. (more…)
Published May 4, 2018
Frequent stock market participants pay close attention when the price of the stock market indexes approaches the 200-day moving average. This trendline is seen as defining whether the market is in an uptrend or downtrend. With the proliferation of mechanical computer-driven trading, trading based on trendlines and other technical chart-based indicators has become quite prevalent. (more…)
Published April 27, 2018
In September of 2007 emerging market stocks ripped higher posting a +10% gain for the month. You would be forgiven for thinking that the market-leading group was merely continuing its 4+ year party, after having already risen four-fold. (more…)
Published December 15, 2017
Outside the U.S. the post-financial crisis rally has been a halting affair, occurring in two major steps higher. Unlike the U.S., each step was greeted with some misgivings as Europe wrestled with its new currency and European Union financial structure while China’s economy digested a massive wave of growth in the prior decade. (more…)