Insights / Blogs

Insights / Blogs

On The Lookout

James Swanson, Chief Investment Strategist, helps readers make sense of the markets by sharing what he learns along the way.

April 21, 2015

Earnings season's greetings

Earnings have taken a hit from a combination of lower oil prices and a higher US dollar.
But similar episodes in history suggest that we may still have some clear sailing ahead.
Economic activity and equity valuations tend to pick up in the first phases of Fed rate cycles.

As earnings season commences for the first quarter, we’ve been thinking about the current slowdown and the interest rate trajectory — with the US Federal Reserve’s first hike still likely to occur later in 2015. What does this backdrop mean for equity valuations and earnings?

April 15, 2015

Profits recession

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Jim Swanson considers similar historical episodes with lower energy prices and a strong US dollar, which hampered earnings in the near term but boosted growth in the longer term. Recorded April 2015.

For more market commentary from MFS, visit our YouTube channel

March 13, 2015

Rising fortunes of US consumers

The latest reports on retail sales have been disappointing.
But I’m still optimistic about the health of US consumers.
I expect consumer spending to sustain this business cycle.

During the first quarter of 2015, the list of economic worries has been long — slow business investment, subpar production growth in many sectors, weaker trade and central bank–driven currency dislocations, just to name a few. On top of that, financial pundits have been writing off US consumers, repeatedly describing them as overstretched, hobbled by low wages and too much debt, and discouraged about job prospects.

March 6, 2015

React to facts, not emotions

Chief Investment Strategist James Swanson talks about the direction of the economy and the markets, and how investors act in response to news events and commentary.

For more market commentary from MFS, visit our YouTube channel.

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February 24, 2015

Never dive for yield

In this low-rate environment, everyone is in the hunt for yield.
When looking for yield, take the time to ask the key questions.
It is important to remember that excess yields often have excess risks.

The interest rates we’ve experienced during our lives have declined, and the yield on bank deposits and certificates of deposit has fallen to almost zero. As investment income becomes scarcer, we face the temptation to reach or, more precisely, dive for yield. This is a quest with deep risks.