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☆ China’s economy is way more screwed than anyone thought
▼ + stars: | 2023-06-14 | by ( Linette Lopez | ) www.businessinsider.com time to read: +12 min

The bubble in China's property market finally popped. In April, China's economic data came in weak largely across the board. The problem is that while consumers may be picking up, the biggest drivers of the Chinese economy — property and exports — are going to stay dormant. Consumer consumption makes up about 37% of the Chinese economy (in the US that figure is about 70%). Beijing has tried to shift the country toward a consumption model, like the US, but exports still make up 20% of China's economy.

Persons: lockdowns, it's, Xi Jinping, Stanley Druckenmiller, We're, Morgan Stanley, Goldman Sachs, Wei Yao, Leland Miller, Miller, Yao, Wright, I've, —, Kearney, Linette Lopez Organizations: Trade, JPMorgan, Bloomberg Invest Conference, Bank of America's, China's National Bureau, Statistics, Societe Generale, Analysts, Beijing, China, Chinese Communist Party, China's Locations: China, globalism, Beijing, York, Asia

☆ The US is building factories at a wildly fast rate
▼ + stars: | 2023-06-08 | by ( Noah Sheidlower | ) www.businessinsider.com time to read: +4 min

New data from the Census Bureau reveals construction spending by US manufacturers more than doubled from last year. According to data from the Census Bureau released last week, construction spending by US manufacturers more than doubled over the past year. The IRA has sought to create new jobs in manufacturing, construction, and renewable energy, estimated to create up to 1.5 million jobs by 2030. Construction spending in most areas of the US economy has fallen in contrast, including office, health care, and educational construction. Census Bureau data reveals manufacturing construction spending has escalated from January 2020 until April 2023 in every region except New England and the Mid Atlantic.

Organizations: Service, Census, World Bank, of Labor, National Association of Manufacturers, National Environmental Locations: China, Asia, New England, India, Thailand, Vietnam

☆ Firms are bringing production back home because of the Ukraine war, China's slowdown — and TikTok
▼ + stars: | 2023-06-01 | by ( Lucy Handley | ) www.cnbc.com time to read: +8 min

Earnings calls discuss 'reshoring'A number of banks noted mentions of the domestic manufacturing trend in U.S. earnings calls for the most recent quarter. And we have never … got the target right," McRaith told an audience at a supply chain conference organized by software company o9 Solutions in April. Bill McRaith Former chief supply chain officer, PVHMcRaith, a former chief supply chain officer at Tommy Hilfiger-owner PVH , said the apparel industry both over-orders and under-orders stock by about 20% to 25%. If we build an economy based on electrification and batteries, it's going to be really important to control our own supply chain. "If we build an economy based on electrification and batteries, it's going to be really important to control our own supply chain," he told CNBC's "Street Signs Asia" in April.

Persons: Luke Sharrett, Savita Subramanian, Ryan Grabinski, they're, Bill McRaith, McRaith, PVH, Tommy Hilfiger, we've, Shein, Jade Gao, it's, Keith Phillips, Joe Biden, CNBC's, Elon Musk, Phillips Organizations: European Union, Bloomberg, Getty, Bank of America, UBS, Securities, o9 Solutions, CNBC, AFP, U.S ., Reshoring, EV, U.S, EVs Locations: China, Ukraine, U.S, Europe, Brazil, Guangzhou, U.S . U.S, Corpus Christi , Texas, Tennessee, United States

☆ A top DeSantis aide battled with Trump's team over his 'Soviet' plan for new 'dystopian' American cities
▼ + stars: | 2023-06-01 | by ( Eliza Relman | ) www.businessinsider.com time to read: +4 min

Ron DeSantis accused Trump of proposing "Soviet dystopian nonsense." Christina Pushaw attacked Trump's plan for new federally-chartered US cities on federal land. Ron DeSantis publicly battled with former President Donald Trump's defenders on Twitter over what she called the ex-president's "Soviet dystopian" plan for American cities. This is Soviet dystopian nonsense," she tweeted. A Republican consultant close to Trump's campaign told Insider in March that Trump came up with the idea for Freedom Cities himself and was likely inspired by Saudi Arabia's futuristic desert cities.

Persons: Ron DeSantis, Trump, Christina Pushaw, Pushaw, —, Donald Trump's, DeSantis, Obama, Biden, Hillary, Paul Ryan, Ron, didn't, I've, Pushaw didn't, Sonnie Johnson, That's Organizations: Gov, World Economic, Service, Florida Gov, Twitter, World, Trump, Freedom Cities, Pacific Partnership, — Trump, Tea Party, Fox News Locations: Soviet, Freedom, globalism, Pres, It's, Saudi

☆ Here's how Bank of America is telling traders to invest up and down the spectrum from large cap to small to book maximum profits while playing smart defense
▼ + stars: | 2023-05-31 | by ( Marley Jay | ) www.businessinsider.com time to read: +5 min

Its equity strategists say that value criteria tend to work best in small- and mid-cap stocks. They added that small caps are an especially good pathway to diversification right now. But they noted that investors can use small caps to diversify their portfolios while also being rewarded for better stock picking. "High Projected Long-Term Growth has not been a strong stock selection factor over the long-term," they wrote. "The best way to pick stocks within small caps over the long-term has been buying stocks with high free cash flow to enterprise value" and other metrics based on free cash flow yields.

Persons: Subramanian, it's, Jill Carey Hall, Nicolas Woods, Woods, Russell, Russell MidCap Organizations: of America, Bank of America, US Equity, Materials, Nasdaq, Bank of

Just where that notional 'R-star' lies has been clouded by the wild supply-side distortions of the COVID-19 pandemic and last year's energy shock. Raising R-star from recent low levels would probably increase uncertainty in markets about its longer-term level and direction too. On the other hand, if R-star is closer to zero, as Williams has suggested should be the case, current policy is too tight. Indeed, R-star is set to fall "slightly below zero," the New York Fed chief said, without giving a time frame. This suggests that the U.S. central bank's current policy rate target range of 5.00%-5.25% is already highly restrictive, and will soon need to come down.

☆ A UBS stock chief breaks down how he's balancing investments in both safe and economy-dependent sectors in a way that will maximize outperformance during a coming recession
▼ + stars: | 2023-05-19 | by ( Lisa Kailai Han | ) www.businessinsider.com time to read: +5 min

Specifically, Lefkowitz has invested in both cyclical and defensive sectors to maximize his returns. In fact, to hedge his bets across a range of economic scenarios, Lefkowitz currently owns both defensive and cyclical sectors. Within the traditionally defensive sectors, Lefkowitz is overweight consumer staples and utilities. The energy sector, on the other hand, stands to benefit from increased investment capital pouring into fossil fuels and renewable energy sources, as a result of the recent energy scarcity crisis. Surprisingly, Lefkowitz is neutral on healthcare — traditionally considered another defensive sector — as a function of not wanting to place all his bets in one direction.

☆ A CIO who helps oversee $100 billion says the mega-cap tech elite responsible for broad stock-market gains this year are more at-risk than people think — and shares 3 areas he likes within equities fo
▼ + stars: | 2023-05-17 | by ( Lisa Kailai Han | ) www.businessinsider.com time to read: +5 min

In particular, Chang believes that mega-cap tech stocks have gotten overextended, and are expensive relative to the rest of the market. But looking below the surface, Chang says that most of this appreciation has been concentrated within a handful of mega-cap tech stocks. Once the recession begins to ease, Chang believes that cyclical names linked to economic strength will start to outperform. That includes tech stocks — specifically semiconductor companies. However, Chang believes that a recessionary period should present better entry points for any investors interested in buying riskier high-yield fixed income assets.

☆ Apple is bigger than the whole market for small caps again. Here's what it means for investors
▼ + stars: | 2023-05-15 | by ( Alex Harring | ) www.cnbc.com time to read: +4 min

The combined value of all of Apple 's shares is greater than the entirety of an index comprised of 2,000 small stocks. That's bigger than the combined market cap of all 2,000 stocks in the small cap-focused Russell 2000 , which was at $2.208 trillion. "It is apples to oranges — or small caps," said Willie Delwiche, founder of Hi Mount Research. DeSanctis also noted the overhang of the debt ceiling could add further pressure to small caps, given their underperformance in 2011. "If something goes right for small cap or the overall market, small can have a really nice bounce," he said.

☆ Reshoring is an emerging trend, earnings calls show — A UBS analyst gives his top pick
▼ + stars: | 2023-05-09 | by ( Michelle Fox | ) www.cnbc.com time to read: +3 min

This earnings season there was a lot of chatter about reshoring — and for UBS, Eaton stands out as the winner of the trend. Government incentives and supply chain security are among the reasons corporate America is jumping on board the booming reshoring trend , which means returning operations to companies' original country from overseas. Reshoring mentions were up 104% year over year during the latest round of earning reports, Bank of America wrote in a note Monday. "They have the broadest set of touchpoints throughout the reshoring process," UBS analyst Chris Snyder said. The U.S. reshoring projects announced so far should drive 3% to 6% market growth for the nation's electrical market over the next five to seven years, essentially doubling its previous growth, Snyder calculated.

But with flights remaining limited after China's border reopening in January, European luxury stores will need to wait longer for the return of masses of tourists they once depended on for growth. The average transaction value by Chinese travellers in Europe in March was 28% above 2019 levels, UBS said, citing data from VAT refund provider Planet. Cartier-owner Richemont (CFR.S), Hermes (HRMS.PA) and LVMH were best placed to benefit from wealthy Chinese shoppers, UBS added. As wealthy Chinese return to Europe and other foreign destinations, the appeal of China's Hainan Island, a duty free shopping hotspot, appears to be waning among top luxury spenders. China's "higher income, top luxury spenders (are) already travelling abroad again," she said, leading to an observable lower per-capita spend in Hainan.

☆ Emerson's quarterly earnings beat shows skeptical investors the industrial is back on track
▼ + stars: | 2023-05-03 | by ( Jeff Marks | ) www.cnbc.com time to read: +5 min

Emerson stock climbed roughly 4% in midday trading, to more than $85 a share. Quarterly commentary Amid mounting economic uncertainty, Emerson's end-markets remain healthy, with underlying sales expected to continue to grow about 7% for the remainder of the year. It's hybrid manufacturing business is seeing underlying sales grow at a high-single-digit percentage, driven by strong reshoring trends in life sciences and investment in lithium and battery metals. And in its discrete manufacturing business, Emerson continues to forecast mid-single-digit underlying sales growth thanks to battery manufacturing investments in the U.S. and Asia. Guidance For Emerson's fiscal third quarter, management expects net sales growth in the range of 10.5% to 12.5% and underlying sales growth in the range of 10% to 12%.

☆ This country is the darling of the markets, Bank of America says. How to play it
▼ + stars: | 2023-04-19 | by ( Sarah Min | ) www.cnbc.com time to read: +3 min

One country is coming up again and again as the clear investor favorite this year, and there are ways for traders to play it, according to Bank of America. The Wall Street firm said Mexico is "the market's darling," with the Indice de Precios y Cotizaciones (IPC) climbing 12% this year. "On top of that, Mexico is perceived as a country that will continue to benefit from nearshoring," he said. Regardless, for investors tapping into the surge in markets, there are several ways to play the rise. For example, the iShares MSCI Mexico ETF (EWW) is up by 20% this year, far outpacing the roughly 4% climb for the broader iShares MSCI Emerging Markets ETF (EEM) over the same time period.

MSCI's Europe index, for example, still trades more than a point below its average historic valuation - with the index priced at less than 13 times its 12-month forward earnings. The top sectoral weighting in the STOXX Europe 50, for example, is healthcare - at almost 23%. With British-based stocks the biggest country weighting in the STOXX Europe index at 26%, the other top four sectors in the index include the food, beverages and tobacco grouping, consumer products, industrial goods and energy. The dollar peaked late last year against most European currencies as the Federal Reserve raced to ratchet up interest rates. Some think the slide in the dollar index of some 12% since last September is barely half of the whole move.

☆ Uranium is having a 'renaissance.' What to know about it, and how to play it
▼ + stars: | 2023-04-07 | by ( Alex Harring | ) www.cnbc.com time to read: +6 min

But despite the strong outlook for the commodity price, stocks and funds related to the commodity have not risen in lock step. The Sprott Uranium Miners ETF (URNM) and Sprott Physical Uranium Trust (SRUFF) are down about 7% and 4% so far this year, underperforming the broad S & P 500 , which has gained 6.5% . He said the Sprott Physical Uranium Trust is a smart play because it has the best risk-to-reward ratio in his eyes and has the benefit of holding actual uranium as opposed to just mining stocks. The company also manages the Sprott Uranium Miners ETF, which Huhn said has a larger emphasis on the mining stocks than the commodity price. Zuri-Invest's option is unique because it has a shorter settlement time and can be redeemed for either money or physical uranium, Huhn said.

☆ This construction stock could gain more than 20% as inflation pressures recede, Goldman Sachs says
▼ + stars: | 2023-04-03 | by ( Alex Harring | ) www.cnbc.com time to read: +2 min

Vulcan Materials shares should see a better year as inflation cools, according to Goldman Sachs. Analyst Jerry Revich upgraded the construction stock to buy from neutral. And unit profitability, which he said is a key stock price driver, should accelerate as inflation stabilizes but prices remain elevated. While private construction spending is tied to the U.S. banking sector, he said aggregate volumes are down around 10% compared with the same period a year ago. And public construction spending should be strong, he said, as pent up demand from Covid years turn to contracts, he said.

☆ Morgan Stanley says these 30 stocks are best positioned for long-term gains as inflation, interest rates, and a banking crisis turn markets upside down
▼ + stars: | 2023-03-22 | by ( Lisa Kailai Han | ) www.businessinsider.com time to read: +4 min

But the chaos has also ushered in the beginning of the end of current bear market, said Mike Wilson. Morgan Stanley shared 30 stocks to buy for long-term outperformance in the next bull market. In fact, Wilson believes that a decline in credit availability may even point to the beginning of the end of the current bear market. In a note from March 21, Wilson and fellow equity strategist Michelle Weaver highlighted the top stocks identified by Morgan Stanley analysts to buy for outperformance and longevity. However, they cautioned that current market pricing or positioning played no role in determining their basket of top stocks.

☆ BlackRock's Larry Fink said the last few years have dramatically reshaped supply chains. Data — and experts — disagree.
▼ + stars: | 2023-03-17 | by ( Emma Cosgrove | ) www.businessinsider.com time to read: +5 min

From the headlines, it's easy to think that supply chains are making a major shift closer to the consumer. "The repeated shocks of the past few years have also dramatically reshaped supply chains," Fink wrote in his highly-anticipated annual letter to shareholders Wednesday. His statements echo those from other top execs and prognosticators, who looked at the last few years and saw inevitable evolution toward more localized supply chains. Before the pandemic, supply chains were largely built with cost as a guiding principle. Is a "dramatic" redesign of supply chains possible?

We're buying 50 shares of Emerson Electric (EMR) at roughly $80.54 and 130 shares of Halliburton (HAL) at roughly $30.20. In essence, the Oscillator measures the buying or selling pressure in the market at the current point in time. EMR YTD mountain Emerson Electric (EMR) YTD performance Emerson's stock decline has made its valuation favorable too. HAL YTD mountain Halliburton (HAL) YTD performance We understand the narrative, but the industry is still catching up from years of underinvestment and if producers want to be capital efficient, then they need to use Halliburton's technology. With HAL shares down about 28% since we sold 375 shares in mid-January, we are upgrading our rating back to a 1.

☆ ABB invests in US robot factory as reshoring trend hots up
▼ + stars: | 2023-03-16 | by ( John Revill | ) www.reuters.com time to read: +3 min

ZURICH, March 15 (Reuters) - ABB (ABBN.S) is expanding its main US robot factory as its customers there in the automotive, packaging and machinery industries confront a tight labour market as they bring production back home. The United States is the third largest in the global robotics market, which is worth around $50 billion per year according to estimates by ABB and the International Federation of Robotics (IFR). Rapid growth is expected as US companies bring production closer to home to avoid logistic log jams which have gummed up supply chains since the global pandemic. A survey by ABB last year showed 70% of North American businesses suffered supply chain disruptions in the last year. "The potential for growth in the industrial robots market is huge," Atiya said.

☆ Mexican stocks are on fire this year. Here's what's driving the gains
▼ + stars: | 2023-03-12 | by ( Alex Harring | ) www.cnbc.com time to read: +6 min

Closer supply chains to the U.S. are giving Mexican stocks a big boost to start the year. The iShares MSCI Mexico ETF (EWW) , which is made up of Mexican stocks, is performing even better — up 15.2%. EWW YTD mountain EWW in 2023 One key factor driving this early outperformance is "nearshoring," which refers to companies bringing supply chains closer to their home country. In this case, many U.S.-based companies are moving their supply chains to neighboring Mexico, which could lead to even more gains in Mexican stocks. Lippmann said the firm likes stocks directly helped by nearshoring trends, such as the real-estate firm Vesta and airport operator OMA .

☆ UBS says to sell Caterpillar, citing sluggish growth outlook
▼ + stars: | 2023-03-10 | by ( Hakyung Kim | ) www.cnbc.com time to read: +2 min

"We don't think there is enough cyclical momentum to justify the current valuation," Fisher wrote. "While we don't think the cycle is over, we don't expect substantial earnings growth (or upward estimate revisions) for 2024-25." "Backlog growth has been decelerating and appears set to roll over, and end market momentum is flattening in parts of construction and oil & gas," Fisher added. "After 27% EPS growth in 2022, we expect growth to slow to 16% in 2023E, and 4% in 2024, with 2025 roughly flat. Residential building, which accounts for roughly a quarter of the company's construction segment, has been stalling, Fisher added.

Fund managers say they are fielding more queries from clients about the odds of an invasion of Taiwan by China. Russia's invasion of Ukraine early last year has also made investors more wary of war risk, analysts said. Goldman Sachs' Cross-Strait Risk Index, which gauges the intensity of geopolitical risk between Taiwan and mainland China, hit a record high last August after then-U.S. House of Representatives Speaker Nancy Pelosi's trip to Taiwan. Jordan Stuart, client portfolio manager at Federated Hermes, says he cut China exposure last year while holding onto some small stocks that can "fly under the radar". The Taiwan Strait is a major route for ships transporting goods from East Asia to the United States and Europe.

☆ Reshoring is accelerating—These stocks should benefit as companies return to the U.S.
▼ + stars: | 2023-02-27 | by ( Michelle Fox | ) www.cnbc.com time to read: +5 min

Reshoring declarations are amping up, as more companies look to return operations to the United States from overseas. Corporate reshoring announcements jumped 17% in the fourth quarter compared with the prior quarter and are now tracking nearly 300% higher than the fourth quarter of 2021, according to UBS. In fact, reshoring and foreign direct investments jobs reached a record of at least 360,000 jobs last year, according to the Reshoring Initiative. The move back to the U.S . can also be seen in corporate earnings, said Ron Graziano, managing director of global accounting and tax for Credit Suisse. The company's equipment is needed for big semiconductor manufacturing plants as companies test chips as they are produced, Snyder said.

☆ The US, China spy balloon tensions are drifting into politics of the supply chain
▼ + stars: | 2023-02-14 | by ( Lori Ann Larocco | ) www.cnbc.com time to read: +2 min

The suspected Chinese spy balloon drifts to the ocean after being shot down off the coast in Surfside Beach, South Carolina, U.S. February 4, 2023. The tensions between the U.S. and China over alleged spy balloons shot down over North America have some of the top trade associations representing companies reliant on Chinese manufacturing to urge their members to diversify their supply chains. "The ongoing tensions with the U.S.-China trade relationship continue to highlight the need for supply chain diversification," said Jon Gold, vice president of supply chain and customs policy of the National Retail Federation. Mark Baxa, president and CEO of the Council of Supply Chain Management Professionals, told CNBC that the trade group's members have been pursuing redundancies in their supply chain since the start of tariffs as a way to offset the risk of ongoing trade policy tensions. "Supply chain leaders are seeking lower risk and a better means to serve the U.S. by looking and moving to Canada and Mexico.

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