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A Bird's Eye View Blog

Fireside Charts 1.30.19

By:BCM Investment Team | Date:Jan30, 2019 | Category: Equity, Economics, Market Highlights, Fireside Charts

While the Midwest experiences temperatures near the lowest ever recorded, US consumers are also feeling icy. Thanks to the government shutdown and volatile markets, consumer confidence hit its lowest level since mid-2017 this month. Meanwhile, the effects of the trade war are still in play as factory orders and shipping demands continue to slow. How much more suffering can global trade activity take? Lastly, a look back at 2018's asset class growth and excess returns. Can you guess what percent of asset classes were flat or negative last year?  

 

1. Some insight into the coming FED meeting?

1.30 chart 3 

 

 

Source: WSJ Daily Shot, as of 1/29/19

 

 

2. While the Government shutdown has been unsettling, regardless of the cause, the "soft" economic data has re-joined the "hard" economic data.

1.30 chart 7

 

Source: Pantheon Macroeconomics, WSJ Daily Shot, as of 1/29/19

 

 

3. With positive earnings surprises down ~25%, negative misses from Caterpillar, NVIDIA, and even Intel may start to weigh more heavily on the markets.

 

 1.30 chart 2

Source: WSJ Daily Shot, as of 1/29/19

 

 

 

4. Full year 2019 earnings expectations have already been halved....

  1.30 chart 11

Source: WSJ Daily Shot, as of 1/29/19

 

 

5. We are following the same path as Smoot-Hawley...

 

1.30 chart 4

 

Source: Capital Economics, WSJ Daily Shot, as of 1/29/19

 

 

6. Some welcome news out of Dallas or at least a pause in the freefall. We suspect the 2019 oil price recovery has helped here.

 

 1.30 chart 1

Source: WSJ Daily Shot, as of 1/29/19

 

 

7. An old favorite...this index tracks the price of dry bulk ship carriers.  Shipping demand has plummeted as global trade plummets.

1.30 chart 10

Source: WSJ Daily Shot, as of 1/29/19 

 

  

8. Tariffs and the trade war continue to devastate including the unintended targets: U.S. multi-national corporations

 

1.30 chart 8

Source: WSJ Daily Shot, as of 1/29/19

 

 

9. Perhaps there is good reason...what is on their books?

1.30 chart 9

 

Source: FactSet, WSJ Daily Shot; as of 1/29/19

 

  

10. If you think investing in 2018 was difficult...you were right.  In fact, ~93% of all asset classes were flat or negative.

 

1.30 chart 5

Source: ReSolve  Asset Management, WSJ Daily Shot; as of 1/29/19

 

 

11. And these same markets gave zero excess return for the first time in 28 years!

 

1.30 chart 6

Source: ReSolve  Asset Management, WSJ Daily Shot; as of 1/29/19

 

 

 

 

As you can see from the charts above, 2018 saw lots of volatility and little growth across major global asset classes. From what we've seen so far, 2019 has been no different. Recently, the market was rising and falling 2, 3, and 4% at a time. Read the BCM 4Q 18 Market Commentary for a debriefing on the last quarter, plus volatility insights and earnings we are tracking so far in 2019.

 

View Now: BCM 4Q 2018 Market Commentary 

 

 

 

Disclosure: The charts and info-graphics contained in this blog are typically based on data obtained from 3rd parties and are believed to be accurate. The commentary included is the opinion of the author and subject to change at any time. Any reference to specific securities or investments are for illustrative purposes only and are not intended as investment advice nor are a recommendation to take any action. Individual securities mentioned may be held in client accounts.