Non-cyclical sectors slightly out performed cyclical sectors during the quarter. In technology, the U.S. is improving, Europe is still not strong and developing markets lag. The healthcare sector improved, but it is still a question mark for the second half of the year. As the economic recovery matures, we have seen a fairly consistent pattern
Insights on current market events and investment opportunities.
Broad measures of cost inflation (PPI and CPI) growth rates have remained near 2% for the past three years. Sharp increases have occurred in isolated areas like trucking, but the effect is far-reaching. Investors must be on the lookout for accelerating expense growth within a company or industry cost structure, as high inflation can lead
In today’s low interest rate environment, investors with cash on hand and a limited appetite for risk aren’t having an easy time growing their wealth. The Fed’s strong influence throughout the government and corporate bond markets makes it hard to find attractive fixed-income instruments of low or moderate risk. To increase an investor’s chances of
Four factors figure empirically into how and why inflation moves: (1) commodity prices, (2) spare capacity, (3) changes in exchange rates, and (4) monetary policy. These same factors argue for a gradual recovery in U.S. inflation in the year ahead, which could be a headwind for high-quality fixed-income returns. In contrast to U.S. markets, in
Since 2011, consumer spending has been below average overall, and spending on retail apparel has been especially poor. A host of factors, from shifting consumer priorities to poor inventory control have forced apparel retailers to compete on price, and sales and profitability have suffered dramatically. Premier global brands with differentiated product and strong, flexible supply
For college savers, 529 plans offer various tax benefits, flexibility and control. 529 account owners have a choice of state plans, regardless of residency or income level. 529 account beneficiaries can use funds at any eligible educational institution and for a number of expenses in addition to tuition. A 529 college savings plan is one
While most equity markets had positive first half performance, we still expect modest acceleration in growth ahead for the global economy. From both a valuation perspective and investor sentiment viewpoint, Chinese, Russian and Japanese equities look cheap. Europe appears vulnerable to shifting sentiment in addition to further downward revisions to profit expectations. In our latest