Int'l Macro Vision: Global Equity Strategy
The curtain is about to drop on 2016, and with it goes a year rich in contrarian trades, ranging from emerging markets like Brazil at the start of the year, to banks and energy in the latter half (not to mention the “contrarian†outcomes of Brexit and the U.S. Presidential election).And, on a not-unrelated note, it has been a year where technicals served as a reliable roadmap. For instance, as the IMF warned throughout the year of a global economic slowdown, technicals (and our reports) pointed out, contrarily, bottoming patterns through Japan, Europe, and EM countries, most recently China and Russia.
Enough about the past. Heading into 2017, what do technicals suggest? More of the same, and that is a good thing. Though the market is beginning to embrace many of 2016's contrarian themes--banks, energy, etc.--charts indicate these trends should extend into next year. Cyclicals continue to lead, and defense is on the defensive. As seen below, the MSCI ACWI Consumer Discretionary/Staples ratio, a rough barometer of the risk appetites, is inflecting higher, confirming the global recovery. And, as we will highlight in this December Macro Vision, Group and bottom-up observations also point to a risk-on environment.
In the remainder of our December Strategy, we highlight the following actionable themes:
• Japan: Japan is breaking out from a YTD bottoming process.
• Europe: Europe is poised for a similar breakout, though pharma stocks are holding it back.
• Emerging Markets: EM remains long-term attractive, but it is becoming increasingly
selective.
• Financial Sector: Overweight. Global bank stocks are breaking out from bottoms.
• Energy Sector: Overweight. Energy is emerging from a cyclical bottom.
• Materials Sector: Overweight. Materials is a leading Sector in every region.
Click on the attachment to read our complete international equity strategy document, and for links to our individual sector comments and recommendations.
For a trial to Vermilion Technical Research call (952) 922-7500, or visit our website at: www.vermilioncap.com
Cenovus Energy is in the business of development, production and marketing of crude oil, natural gas and natural gas liquids ("NGLs") in Canada with refining operations in the U.S. Co. operates in two business segments: Upstream, which includes Co.'s development and production of crude oil, NGLs in Canada, is organized into two operations: Oil sands and conventional; and Refining and Marketing, which is focused on the refining of crude oil products into petroleum and chemical products at two refineries located in the U.S. This segment also markets Co.'s crude oil and natural gas, as well as third-party purchases and sales of product.
Vermilion Research delivers timely, actionable, and unique research inputs to professional investors. Our research strategists highlight securities which we believe are at major inflection points, based on our various proprietary technical indicators, and offer asymmetric risk/return profiles. We believe our research methodology, which is not limited by industry sector or market capitalization, enables us to deliver superior investment recommendations.
Our process begins by organizing all actively traded stocks into coherent sectors, then into logical industry groups. We then apply our proprietary relative strength tools to identify developing price trends. Once attractive trends are identified within a selected sectors or groups, we screen for individual stocks which we believe offer the best risk/reward profile. Vermilion offers U.S. and global equity market research products. Vermilion’s research team, which has received numerous awards and accolades, has a combined 70 year of experience in the analysis of investment securities.
Unfortunately, this report is not available for the investor type or country you selected.
Browse all ResearchPool reportsReport is subscription only.
Thank you, your report is ready.
Thank you, your report is ready.