While the risks of today’s low-volatility stock market are clear, we continue to believe the next sell-off in the broader market will be a correction, not the beginning of a new bear market. Look for a rotation out of the growth-oriented fare and into cyclical and value groups.
Every earnings season, companies in the oil-field services industry highlight emerging technologies that can help upstream operators to improve their well productivity, boost operational efficiency and reduce per-barrel production costs. The current trends and new techniques are perhaps more important than ever given current prices.
Four months into the year and the global economy is in the midst of synchronized growth that should allow it to grow around 3.5 percent this year. China’s solid growth, India’s recovery after the monetarization jitters and the eurozone’s stronger-than-expected growth have been the catalysts for the strong showing this year.
Remember that the stock market comprises a wide range of investors and institutions whose different objectives and strategies dictate how they react to the news. In many instances, their approach may not align with what’s in your best interests; follow their lead at your own peril.
China is the stock market investors love to hate. The conversations are always about what could go wrong and rarely what could, or will, go right. And yet China’s equities have outperformed emerging markets during the past one-, three- and five-year periods. For the past year, we’ve made the case that cyclicals and growth names should be the focus when investing in China.
With this year’s fourth quarter around the corner, we maintain a positive view on the miners. The majority of our preferred global macro indicators are holding well, and the mining sector still trades at a deep discount to the market. Metal prices already show strength, suggesting corporate earnings should soon follow.
Investment correlations that favored passive investment strategies are likely to break down while the bull market nears its end, favoring strong pickers. Look to emerging markets for some of the best opportunities.
The tech sector’s long rally may cause unease for many investors wondering whether they’ve waited too long to profit. While many of the big names trade at unattractive lofty valuations, several companies and strategies still work with this unflinching tech bull market.
DISCLAIMER: Capitalist Times, LLC is a publisher of financial news and opinions and NOT a securities broker/dealer or an investment advisor. You are responsible for your own investment decisions. All information contained in our newsletters or on our website(s) should be independently verified with the companies mentioned, and readers should always conduct their own research and due diligence and consider obtaining professional advice before making any investment decision. As a condition to accessing Capitalist Times materials and websites, you agree to our Terms and Conditions of Use, available here including without limitation all disclaimers of warranties and limitations on liability contained therein. Owners, employees and writers may hold positions in the securities that are discussed in our newsletters or on our website.