Macro Briefing | 5 December 2019

China wants US tariffs cut before agreeing to a trade deal: Reuters
US considering new deployment of troops to Middle East to counter Iran: WSJ
Iran has secretly moved missiles into Iraq: NY Times
Eurozone retail spending fell more than forecast in October: MW
Japan is planning a $120 billion economic stimulus program: Reuters
Global economic growth remains slow but pace strengthened in Nov: IHS Markit
ISM Non-Mfg Index: US services sector slowed more than forecast: CNBC
Services PMI for US reflects modest growth in November: IHS Markit
US private employment growth slowed sharply in November: MW

Quality Is The Lone Equity Factor Beating The Market This Year

Volatility has returned to the stock market this week after a couple months of relative calm. Not surprisingly, the sharp wave of selling on Monday and Tuesday has reordered the horse race for primary equity factors. As a result, the so-called quality factor is the last man standing for outperforming the broad market year to date, based on a set of exchange-traded funds.

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Macro Briefing | 4 December 2019

House impeachment report: Trump abused power: The Hill
Trump suggests US-China trade war could continue beyond 2020 election: WSJ
Despite recent tension, US and China reportedly closer to trade deal: BBG
Will a new round of US tariffs on Chinese goods roll out on Dec 15? CNBC
China Composite PMI for Nov shows solid rebound for economy: IHS Markit
Eurozone economy continued to post near-stagnant growth in Nov: IHS Markit
10-year Treasury yield falls sharply to 1.72% — lowest since Oct 31:

Risk Premia Forecasts: Major Asset Classes | 3 December 2019

The outlook for the Global Market Index’s risk premium ticked higher for a third month in a row in November. The adjustment, due to evolving market conditions, lifted GMI’s expected long-term return to an annualized 4.9% (before factoring in a “risk-free” rate). The new estimate is fractionally above last month’s forecast (4.8%) and modestly higher vs. the year-ago estimate (4.6%). GMI is an unmanaged, market-value-weighted portfolio that holds all the major asset classes (except cash).

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Macro Briefing | 3 December 2019

US threatens new tariffs on French goods in response to digital tax: CNBC
France says it will retaliate over new US tariff threat: Bloomberg
Global Mfg PMI reflects growth in November–first gain in 7 months: IHS Markit
Is the fate of global economy tied to the health of US consumers?: Bloomberg
US construction spending fell in Oct but 1yr trend returns to growth
In contrast with ISM data (see below), US Mfg PMI rebounds in Nov: IHS Markit
US ISM Mfg Index continues to show mild contraction for sector in Nov: ISM

Macro Briefing | 2 December 2019

UN chief: ‘War against nature must stop’: Reuters
China suspends US Navy visits to Hong Kong, sanctions US groups: Reuters
China’s mfg sector expanded by more than expected in Nov: CNBC
US mfg data in focus in today’s releases: CNBC
Euro area’s mfg sector continues to contract in November: IHS Markit
UK mfg contracts as Brexit uncertainty weighs on sector: IHS Markit
Global debt on track to rise to a record $255 trillion-plus in 2019: Bloomberg

Book Bits | 30 November 2019

The AI Economy: Work, Wealth and Welfare in the Age of the Robot
By Roger Bootle
Summary via FT
Bootle, chairman of Capital Economics, argues that the economic effects of artificial intelligence may not be as different from those of previous technological transformations as many suppose; that the speed with which the changes occur may not be all that fast; and that, in all probability, piecemeal changes in policy, rather than a radical shift towards universal basic income, are the right response. We need to hear his arguments.
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Off The Charts: Extreme Moves In ETFs — 29 November 2019

Today begins a semi-regular column that focuses on a handful of ETFs that have recently posted extreme changes. The playing field starts with nearly 100 equity funds (US and foreign). For a complete list, see a recent edition of The ETF Portfolio Strategist. The goal: highlighting some of the gains and losses at the outer edge of market action of late, where the odds may be slightly higher for developing quasi-reliable near-term expectations, perhaps for use in adding context to strategic-oriented return estimates. In any case, all the standard caveats still apply and so proceed accordingly.

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