1.More Central Banks Shift to Easing

Central Banks and the Search for Yield

Posted by lplresearch

Central banks are back in easing mode, to the dismay of coupon-clipping fixed income investors.

As shown in the LPL Chart of the Day, Global Central Banks Back in Easing Mode, central banks around the world are embarking on a marked policy shift as trade tensions pressure the global economy and government becomes more intertwined with policy decisions.

Two of the world’s most influential central banks, the Federal Reserve (Fed) and the European Central Bank (ECB), are eyeing looser policy in the months ahead. We expect the Fed to implement a 25 basis point (0.25%) “insurance” rate cut at its July meeting, and policymakers have already announced plans to end balance sheet runoff in September. The ECB has all but promised a new wave of accommodation, likely through asset purchases.

https://lplresearch.com/2019/07/16/central-banks-and-the-search-for-yield/

1.Libor Rolls Over with World Rates After Getting Above 2.5%

$200 trillion in loans based off libor…95% derivatives

https://www.reuters.com/article/us-usa-bonds-libor/u-s-libor-exposures-larger-than-thought-at-200-trillion-arrc-idUSKBN1GH2Z8

Libor 6 Month Chart

https://www.moneycafe.com/6-month-libor/

Libor 5 Year Chart

https://www.macrotrends.net/1433/historical-libor-rates-chart

1.PIMCO Chart Breaking Down Leadership into 3 Year Periods.

Large Cap Growth Leading for 6 ½ Years.

https://www.pimco.com/en-us/pmip/financial-markets-equities?utm_campaign=pimco%5Finsights&utm_medium=spredfast&utm_content=sf209383229&utm_source=linkedin&sc_camp=7FED56B02D114D5790748C145A782889&sf209383229=1

1.Highest Increase in Earnings was Healthcare.

Most S&P 500 sectors are expected to show earnings declines; health care is an exception

Cigna’s quarterly sales per share are expected nearly to double, even with significant dilution from issuing shares to help pay for its acquisition of Express Scripts.

By
PHILIPVAN DOORN

Despite all the good economic news, earnings growth is expected to slow to a crawl this year for large U.S. companies. It may also surprise you that the health-care sector is seen as one of the exceptions.

During the first quarter of 2019, earnings per share declined from a year earlier for six of the S&P 500’s SPX, +0.45%  11 sectors. These are the five that countered the trend, according to S&P Global Market Intelligence:

For the second quarter, consensus estimates among analysts polled by S&P Global Market Intelligence are for the S&P 500’s weighted aggregate EPS to increase 2.2% from a year earlier. Even so, all but these three sectors are expected to show declines:

Health care is one of the stock market’s healthiest sectors right now

https://www.marketwatch.com/story/health-care-is-one-of-the-stock-markets-healthiest-sectors-right-now-2019-07-08?mod=mw_theo_homepage&mod=mw_theo_homepage&mod=mw_theo_homepage

Healthcare ETF not yet at new highs

1.Tech Funds Second Largest Weekly  Inflows Ever.

From Dave Lutz at Jones Trading.