Perspectives Blog

European equities – Should investors care about periphery vs. core anymore?

Dan Ison, Portfolio Manager | January 13, 2014

The more dramatic the economic reforms, the better the stock market performance in the eurozone We expect nominal growth to be the key driver of an improving earnings picture in Europe European equities should show further good returns to investors in 2014 As we enter 2014 there are the usual questions, conversations and strategy pieces extolling the virtues of different regions and asset classes. 2013 saw a phoenix-like resurgence in interest…

Where’s Waldo? Be on the lookout for rising costs in a low growth world

Paul DiGiacomo, Senior Analyst | August 18, 2014

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 to lower stock returns. Over the past three years, Producer Price Index (PPI) and Consumer Price Index (CPI…

Does Japan’s sell-off present buying opportunities?

Daisuke Nomoto, Senior Portfolio Manager | February 10, 2014

…ax cuts; ii) granting a Special Economic Zone license to Tokyo, Osaka, Nagoya, Hokkaido and/or Okinawa; and iii) labor reform to ease working visa issuance to foreign workers for the construction and medical industries, raise female labor participation rate, etc. Since the market expectation of Abe’s growth strategy is somewhat low at the moment, any clarity about it could positively surprise the market. It is hard to imagine that the Japanese st…

Digital dining: How restaurants are applying technology to drive sales

Daniel Spelman, Equity Analyst | February 24, 2014

Restaurants are modernizing dining with consumer-centric tech focus. Large chains are the leaders, investing more and increasing market share. Innovation is boosting efficiency and reducing costs. In a $680 billion industry that is notoriously low margin, competitive and high touch, restaurants are increasingly using technology to differentiate themselves from the crowd. Advancements in digital ordering, loyalty, payments and convenience are i…

Signs point to an improving U.S. economy

Marie M. Schofield, CFA, Chief Economist and Senior Portfolio Manager | December 9, 2013

…he payroll report continued to post moderate and steady payroll gains consistent with a sustained improvement in labor markets. The interruption from the government shutdown in October, if it was seen at all, was mostly reversed based on November labor market releases from BLS. Indeed, the business survey data maintained its recent strength, a precondition to any taper decision by the Fed. Nonfarm payrolls rose 203,000 in November with prior mont…

U.S. rates — Data dependence

Zach Pandl, Portfolio Manager and Strategist | June 23, 2014

Evidence of data dependency at the June FOMC meeting suggests policy will respond to unemployment and inflation surprises. We are more confident the Fed’s reaction function is (nearly) done moving. We therefore remain cautious about exposure to U.S. interest rate risk, especially at the middle of the yield curve. The June FOMC meeting contained a little bit for everyone and interest rates reacted only marginally after the announcements. But lo…

FOMC December meeting scouting report

Zach Pandl, Portfolio Manager and Strategist | December 16, 2013

We expect Fed officials to announce the first slowing of QE at this week’s FOMC meeting The main risk to our expectations is the still-low level of core inflation We also expect the FOMC to pair any slowing of QE with qualitative changes to its forward guidance In the press conference after the September FOMC meeting, Fed Chairman Bernanke offered three reasons for why the committee chose not to slow the pace of its bond purchases: (1) insuffi…