“Is the market high only because of some irrational exuberance— wishful thinking on the part of investors that blinds us to the truth of our situation?” 
― Robert J. Shiller

►Everybody seems concerned about slowing global growth but equity markets have staged a remarkable recovery after a dismal Q4 – last week was exceptional with small caps leading the way

►US Large cap, blue chips have outperformed in the last month

►Small caps, not surprisingly, have been a lot more jumpy but YTD are slightly ahead US large caps

►Over the last 12 months, US equities are up while international still show losses

►Valuations are still a bit stretched in the US but growth and profitability are hanging in

►The key for equity markets is global growth and whether we are entering a slowdown or not

Countries & Region:

►Despite concerns about global economic growth, all major equity markets with the exception of Australia had strong positive returns last week

►Commodity indices were up big last week as oil prices continued firming up due to supply cuts

►In the US Value did very well beating Growth by close to 1%

►In international markets Value out-performed Growth by a smaller margin driven primarily by sector differences

►Globally, Discretionary, Financials and Materials out-performed last week while lower beta sectors such as Staples and Utilities lagged behind

Style & Sector:

►In the US, we saw Small Caps do better than large caps

►The size effect in the US was really strong last week in favor of small caps

►Within equity styles, Quality strategies out-performed

►The Momentum factor has lost “mo” – momentum stocks have underperformed the general market this year

►International equities last week took a hit as the USD remained strong losses

►On a YTD basis developed  Europe has outperformed other international strategies

This Coming Week:

►The strength of the equity market recovery has been impressive especially among small caps but last week was exceptional

►We believe that a risk on/off market is likely this year

►Equity Technicals have improves significantly this year and we no longer believe that we are in a nascent Bear Market

►Brexit is up for yet another delay but prospects of passing Parliament are slim. Could we be starring at Referendum 2.0?

►Tariff wars are taking a bite with the IMF recently citing trade wars as the main reason for a cut in their forecast of global growth

►Our models still favor a reduction in risk in our portfolios with positive active allocations to cash and bonds

►The price of higher equity returns is discomfort – volatility has been too low in the last few years

►We believe that the US yield curve will become positive again as people realize that growth while slowing down is still ok

To read our weekly report including style factor breakdowns please click  here

Eric J. Weigel

Global Focus Capital LLC

eweigel@gf-cap.com

______________________________________________________________________________

Weekly Asset Allocation Review – Free

Weekly Equity Themes Review – Free

The Equity Observer (Monthly) – Subscription Required

The Asset Allocation Advisor (Monthly) – Subscription Required

“Is the market high only because of some irrational exuberance— wishful thinking on the part of investors that blinds us to the truth of our situation?” 
― Robert J. Shiller

►Equity markets have staged a remarkable recovery after a dismal Q4 but last week was a wake-up call

►Over the last month, US small and large caps have performed in line with each other but ahead of international equity strategies

►Over the last 12 months, US large cap equities are up slightly while US small cap and international still show losses

►Valuations are still a bit stretched in the US but growth and profitability are hanging in

►The key for equity markets is global growth and whether we are entering a slowdown or not

Countries & Region:

►A global recovery for equities was interrupted last week as growth concerns returned to the forefront

►Commodity indices were flat last week as oil prices firmed but agricultural markets headed south due to excess supply conditions

►In the US Value slightly under-performed  Growth last week, but the main style effect was size (the smaller the worse)

►In international markets Value under-performed Growth by a wider margin driven primarily by sector differences

►Globally, Energy, Financials and Health Care under-performed last week while interest-sensitive sectors such as Telecom and Utilities held their own

Style & Sector:

►In the US, we saw Small Caps do worse than large caps

►The size effect in the US was really strong last week

►Within equity styles, Quality, Yield, and Low Vol strategies delivered lower losses (lower beta)

►The Momentum has lost “mo” – momentum stocks have underperformed the general market this year

►International equities last week took a hard hit both in local currency as well as through currency losses

►On a YTD basis developed Europe has outperformed other international strategies

This Coming Week:

►The strength of the equity market recovery has been impressive especially among small caps

►We believe that a risk on/off market is likely this year

►Given the low levels of investor risk aversion we would expect a reversal in the near future

►Equity Technicals have deteriorated to the point that 35% of stocks remain in the Down Trend Phase

►Political drama in Washington is exacerbating the uncertainty of market participants but investors seem to be in denial thus far in 2019

►Brexit is up for the spring but prospects of passing Parliament are slim. Could we be starring at Referendum 2.0?

►Tariff wars are taking a bite with the IMF recently citing trade wars as the main reason for a cut in their forecast of global growth

►Our models still favor a reduction in risk in our portfolios with positive active allocations to cash and bonds

►The price of higher equity returns is discomfort – volatility has been too low in the last few years

►While Value is holding its own with Growth we still see the action at the sector level rather than in terms of pure valuation

To read our weekly report including style factor breakdowns please click  here

Eric J. Weigel

Global Focus Capital LLC

eweigel@gf-cap.com

______________________________________________________________________________

Weekly Asset Allocation Review – Free

Weekly Equity Themes Review – Free

The Equity Observer (Monthly) – Subscription Required

The Asset Allocation Advisor (Monthly) – Subscription Required

“Investing is not nearly as difficult as it looks. Successful investing involves doing a few things right and avoiding serious mistakes”

– Jack Bogle

►Equity markets have staged a remarkable recovery after a dismal Q4

►Over the last month, US small and large caps have performed the best

►Over the last 12 months, US equities are up slightly while International still show large losses

►Valuations are still stretched in the US but growth and profitability are hanging in

►The key for equity markets is global growth and whether we are entering a slowdown or not

Countries & Region:

►A global recovery for most but with large differences in global market performance

►Commodity indices continue their recovery as oil prices firmed up helping resource oriented markets

►In the US Value slightly outperformed  Growth last week, but the main style effect was size (the smaller the better)

►In international markets Value under-performed Growth by a wide margin driven primarily by sector differences

►Globally, Energy and Industrials performed best last week while interest-sensitive sectors such as Telecom and Utilities under-performed

Style & Sector:

►In the US, we saw Small Caps do best

►The size effect in the US was really strong last week

►Within equity styles, Quality strategies continue shinning

►The Momentum has lost all “mo” – momentum stocks have underperformed the general market

►Developed Europe rebounded strongly last week despite growth concerns

►Latam has vastly outperformed EM Asia – YTD it is up nearly double the EM index

This Coming Week:

►It’s been a huge surprise how strong equity markets have been this year especially in the US

►Equity Technicals have improved to the point that only 13% of stocks remain in the Down Trend Phase

►The strength of the stock price recovery has been so extreme that a quick reversal would not be out of the question

►Political drama in Washington is exacerbating the uncertainty of market participants but investors seem to be in denial thus far in 2019

►Brexit is up for the spring but prospects of passing Parliament are slim. Could we be starring at Referendum 2.0?

►Tariff wars are taking a bite with the IMF recently citing trade wars as the main reason for a cut in their forecast of global growth

►Our models still favor a reduction in risk in our portfolios with positive active allocations to cash and bonds

►The price of higher equity returns is discomfort – volatility has been too low in the last few years

►This coming week has huge earnings implications. Lots of companies reporting Q4.

►While Value is holding its own with Growth we still see the action at the sector level rather than in terms of pure valuation

To read our weekly report including style factor breakdowns please click  here

Eric J. Weigel

Global Focus Capital LLC

eweigel@gf-cap.com

______________________________________________________________________________

Weekly Asset Allocation Review – Free

Weekly Equity Themes Review – Free

The Equity Observer (Monthly) – Subscription Required

The Asset Allocation Advisor (Monthly) – Subscription Required

“Investing is not nearly as difficult as it looks. Successful investing involves doing a few things right and avoiding serious mistakes”

– Jack Bogle

►Equity markets have staged a remarkable recovery after a dismal Q4

►Over the last month, US small caps and EM stocks have performed the best

►Over the last 12 months all major equity asset classes are down with US Large Cap the least and EM the most

►Valuations while more reasonable than 3 months ago are not yet favorable – we may be seeing a reversal from the q4 downdraft, not a fundamental uptrend

►The key for equity markets is global growth and whether we are entering a slowdown or not

Countries & Region:

►A global recovery for most but with large differences in global market performance

►Commodity indices continue their recovery as oil prices firmed up helping resource oriented markets

►In the US Value and Growth performed in line last week, but higher dividend yield stocks really rocked it

►In international markets Value under-performed Growth by a wide margin driven primarily by sector differences

►Globally, Staples and Energy performed best last week while Financials gave back some of the gains from the previous week

Style & Sector:

►In the US, we saw Large Caps  do best

►The size effect in the US was strong (in reverse of expectations)

►Within equity styles, Dividend Yield and Quality strategies resulted in better performance

►The Momentum trade has made a bit of a comeback in 2019 – it’s up 7% YTD

►Latam shot up last week – the index is up 14.7% for the year

This Coming Week:

►Risk Aversion should spring up this week with more earnings in the US

►Equity Technicals have improved to the point that only 13% of stocks remain in the Down Trend Phase

►Political drama in Washington is exacerbating the uncertainty of market participants but investors seem to be in denial thus far in 2019

►Brexit is up for the spring but prospects of passing Parliament are slim. Could we be starring at Referendum 2.0?

►Tariff wars are taking a bite with the IMF recently citing trade wars as the main reason for a cut in their forecast of global growth

►Small caps are the best performing major asset class in 2019 after a dismal 2018 – some of it is due to a snap back but we are still underweight small caps

►Surprisingly EM equities have outperformed developed markets in the last month. 

►Our models still favor a reduction in risk in our portfolios with positive active allocations to cash and bonds

►The price of higher equity returns is discomfort – volatility has been too low in the last few years

►This coming week has huge earnings implications. Lots of companies reporting Q4.

To read our weekly report including style factor breakdowns please click  here

Eric J. Weigel

Global Focus Capital LLC

eweigel@gf-cap.com

______________________________________________________________________________

Weekly Asset Allocation Review – Free

Weekly Equity Themes Review – Free

The Equity Observer (Monthly) – Subscription Required

The Asset Allocation Advisor (Monthly) – Subscription Required

“Investing is not nearly as difficult as it looks. Successful investing involves doing a few things right and avoiding serious mistakes”

– Jack Bogle

►The seesaw continues for risky assets as small caps take the lead for 2019 but investors feel the tension

►Over the last month, US small caps and EM stocks have made money

►Over the last 12 months, all major equity asset classes are down with US Large Cap the least and EM the most

►Valuations while more reasonable than 3 months ago are not yet favorable – we may be seeing a reversal from the q4 downdraft, not a fundamental uptrend

►The key for equity markets is global growth and whether we are entering a slowdown or not

Countries & Region:

►A global recovery but with large differences in global market performance

►Commodity indices continue their recovery as oil prices firmed up helping resource oriented markets

►In the US Value outperformed Growth last week – higher dividend yield underperformed but the sector effect was dominant as was the quality factor

►In international markets Value out-performed Growth by a smaller margin than in the US

►Financials performed best and Utilities did the worst (barely positive)

Style & Sector:

►In the US, we saw Midcaps do best followed by large caps

►Value performed a bit better than Growth

►Within equity styles, Quality strategies resulted in better performance

►The Momentum trade has made a bit of a comeback in 2019 but the effect is still uncertain

►EM Asia and Latam shot up last week recovering from poor 2018 performance

This Coming Week:

►Risk Aversion should spring up this week unless China and the US reach a deal on tariffs

►Equity Technicals have improved to the point that only 17% of stocks remain in the Down Trend Phase

►Political drama in Washington is exacerbating the uncertainty of market participants but investors seem to be in denial thus far in 2019

►Brexit is up for the spring but prospects of passing Parliament are slim. Could we be starring at Referendum 2.0?

►Tariff wars are taking a bite with the IMF recently citing trade wars as the main reason for a cut in their forecast of global growth

►Small caps have massively underperformed large caps over the last 3 months but have had a nice a nice recovery in 2019

►Surprisingly EM equities have outperformed developed markets in the last month. 

►Our models still favor a reduction in risk in our portfolios with positive active allocations to cash and bonds

►The price of higher equity returns is discomfort – volatility has been too low in the last few years

►This coming week has huge earnings implications. Lots of companies reporting Q4.

To read our weekly report including style factor breakdowns please click  here

Eric J. Weigel

Global Focus Capital LLC

eweigel@gf-cap.com

______________________________________________________________________________

Weekly Asset Allocation Review – Free

Weekly Equity Themes Review – Free

The Equity Observer (Monthly) – Subscription Required

The Asset Allocation Advisor (Monthly) – Subscription Required