Category: Daily Instagraph

US stocks have now outperformed the global stocks by almost 3 times! (in USD terms). This is the highest level since WWII and more than during the Nifty 50 bubble and during the Internet bubble. There are reasons for the current dominance of US stocks: 1) the high weight of highly performing US tech stocks … Continued

As expectations of Powell’s speech at the Jackson Hole symposium and Nvidia’s consensus beating results make the headlines, there is little discussion on the worsening economic environment in Europe. The Eurozone composite PMI, the most important economic leading indicator, is now in contraction territory ( below 50 ). This is not only driven by the … Continued

The likelihood of making a positive return in stock market increases substantially with your holding period. At least this has been the case for investors in the S&P500 with data going back to 1928. If you invested for 1 month in the S&P 500, the probability of a positive return was 63%. If you invested … Continued

The last time the gap between the yield of the 10 Year Treasury and the dividend yield of the S&P500 was so high was in 2007! On this measure often used by the Fed and called the Fed model, equities have not been as expensive compared to bonds in more than 15 years. Also there … Continued

Morgan Stanley summarizes the key risks facing the Chinese economy as the 3Ds – demographics, deflation and debt. A lot has been written about Chinese demographics being the result of State policies. The current economic data coming out of China is not reassuring while debt levels are unsustainably high. We draw three conclusions: 1/ Chinese … Continued

The latest BofA Global Fund Manager Survey gives us a clear indication most institutional investors believe inflation has peaked. In such a scenario, being long 10 or even 30 year Treasuries makes sense and appears to become an overcrowded trade. While we believe the odds are high inflation has indeed reached a high, we would … Continued

Below the surface, there is still value in the US stock market as a good part of the high multiples are explained by technology and particularly AI-related stocks. Nasdaq currently trades at 31.1 times forward earnings, which is close to the highs of the peak of the Internet bubble. The top 12 AI-related stocks currently … Continued

The holding company of the Agnelli family, Exor, has taken last week a 15% stake in the Dutch healthcare company Philips worth 2.6 bn EUR. Exor had announced before planning to expand its healthcare portfolio and Philips is definitely a long term investment opportunity. The stock is down 60% since the announcement of the recall … Continued

Yesterday’s US inflation numbers were weaker than expected with core CPI ( excluding food & energy ) rising 0.2% for a second month in a row, the smallest back-to-back gains in 2 years. While all this is certainly positive, we believe it is too early to cry victory as inflation can come back with a … Continued

When looking at the evolution of the cost of housing in the US over the last 50 years, we draw 2 conclusions. Firstly, the costs of renting have increased almost 10 fold in nominal terms since the 70’s and, secondly, the cost of buying has decoupled completely from the cost of renting over the last … Continued