According to Bespoke Investment Group, the S&P posted five consecutive weekly gains of at least 1% between January 8th and February 9th, the first such streak since 2016.
Despite a brief pause mid-month, equities continued their rally into month-end, leaving our Momentum Dial in a Positive position.
After showing signs of life last month, new manufacturing orders contracted in February, suggesting that the persistent high interest rate environment continues to provide a headwind to future economic activity.
With the Fed’s first rate cut potentially on hold until June, our Economic Dial remains in a Negative position for now.
While last year’s tech rally relied primarily on multiple expansion, so far the story of 2024 has been backed by fairly strong earnings growth.
That said, high discount rates leave P/E ratios stretched, and as such our Valuation Dial remains Negative.
Our composite Three Dials reading remains in a Moderately Defensive position through the month of February, with two dials Negative and one dial Positive.
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The markets can be difficult to navigate and can be bumpy along the way. Through our collective 75+ years of experience, we’ve learned to keep it simple.
Our investment advice is based on a principled, evidence-based strategy that guides our decisions. We work to mitigate downside exposure while producing competitive returns over the long-term.
Our investment philosophy, known as the “Three Dials”, factors in three primary indicators: Momentum, Economic Fundamentals and Valuation.
The Three Dials provide a cohesive reading on the health, or “pulse” of the markets. The Dials provide a passive investment approach, with an active overlay. Each dial adjusts to data-driven indicators for maximized risk efficiency and an optimal allocation of diversified assets within your portfolio.
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