The Global Markets Channel

Schwab Market Perspective: The Big Picture Heading into 2018

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Capitalizing Potential

A massive amount of stock market capitalization is tied up in companies based on both their potential market share and hypothetical future profits. The popular arguments in their favor come from looking at a company’s total addressable market (TAM). Sky high price-to-earnings ratios and massive capitalizations are common in companies with a large TAM as we finish up 2017.

Taking Tally of the Global Rally

As we look ahead to 2018, it’s important to first recognize how significant 2017 has been for international markets. This is the eighth year of a global bull market, but prior to 2017, international markets had trailed the US for four consecutive years — and for six of the last seven years.

From Reflation to Inflation

The U.S. economy is shifting from reflation to inflation – and we have greater confidence in inflation returning to its medium-term trend and the Federal Reserve’s target. Better wage growth and potential fiscal stimulus should cement this transition.

Where Might Credit Risks Exist? Follow the Supply

In 2017, corporate credit, including high yield, saw a resurgence in interest within a longer-term trend of increasing supply. In recent weeks, however, it has shown some cracks.

The Risk of Taking Risks

In the concluding piece of our three-part series on principles of the low-return imperative, we discuss why we believe investors can no longer take on risks they don't expect to get paid for—and identify two key risks we see as unrewarded.

Synchronized Global Growth May Have Arrived

Nearly 10 years after the financial crisis brought the global economy to its knees, conditions have finally improved enough to crystallize my conviction that synchronized global growth is currently underway. Revenue and earnings growth are up year-over-year, not just in the U.S. but worldwide. Despite President Donald Trump threatening to raise tariffs and tear up trade deals, global trade is accelerating. World manufacturing activity expanded to a 78-month high of 53.5 in October, with faster rates recorded in new orders, exports, employment and input prices.

S&P 500 Snapshot: Down 0.13% from Last Week

The S&P 500 opened Friday below yesterday's close and oscillated around a small range throughout the day, closing with a daily loss of 0.26% and a weekly loss of 0.13%. Year-to-date, the index is up 15.19%.

ECRI Weekly Leading Index: WLI at 5.5% YoY

Today's release of the publicly available data from ECRI puts its Weekly Leading Index (WLI) at 145.6, down 0.1 from the previous week. Year-over-year the four-week moving average of the indicator is now at 5.52%, down from 5.53% last week. The WLI Growth indicator is now at 2.7, down from the previous week.

Solar Energy Boom Could Heat Up the Global Energy Sector

By 2040, the world will need to add the equivalent of India and China’s current energy system to meet the demands of a surging global population and rising incomes.

The Fundamental Case for Japanese Stocks

We’ve been arguing for the last year that US-based investors would be well served to overweight foreign versus domestic equities. In this post we’ll dig into that topic a little deeper to try to convey a few of the company specific fundamental drivers of our foreign vs domestic call, especially as they relate to one of our favorite markets: Japan.

Structural Growth Drivers Behind Emerging-Market Economies

My colleagues and I have been championing the message that emerging markets have changed—they are no longer just commodity plays. Old economic models are undergoing a transformation in many cases, opening up exciting new investment opportunities.

Ian Bremmer – The End of the Global Free Market

The U.S. is no longer fit to lead in global governance and that is driving a change in the world order. As a result, the coming decade will be vastly more unstable, according to Ian Bremmer.

China's Slow Recovery from Debt Hangover Begins

Growth in the country's corporate debt load has finally leveled off this year as financial conditions and regulatory oversight tighten. That's good. But rebounding returns on incremental assets and common equity are even better.

Mohamed El-Erian – Which Asset Classes are Most Vulnerable

Mohamed El-Erian says that investors have been “enticed to become increasingly exposed to historically illiquid asset class segments.” Here are the asset classes and ETFs that are most at risk.