The expected risk premium for the Global Market Index (GMI) remained subdued in January. GMI — an unmanaged, market-value weighted mix of the major asset classes — is projected to earn an annualized 2.9% return over the “risk-free” rate in the long term. (For details on the equilibrium-based methodology that’s used to generate the forecasts each month, see the summary below.) Today’s revised estimate, which is based on data through last month, matches the projection in the previous month’s update.
Continue reading →

● US Personal Income Rising, Spending Flat in Dec | 24/7 Wall St
● ISM: US mfg contracts for 4th straight month in Jan | MarketWatch
● PMI: Modest growth in US mfg picks up in Jan | Markit
● Slim rise for US construction spending in Dec | RTT
● Gallup: US consumer spending slips in Jan | Gallup
● Global Mfg growth is weak in Jan but ticks higher | Markit
● Eurozone unemployment ticks lower in Dec but so do factory prices | Reuters
● Republican Cruz bests Trump in Iowa race, Clinton edges out Sanders | Reuters

The risk-off trade continued to weigh on the major asset classes in January. The main exception: several slices of high-quality bonds popped last month, led by the 1.5% total return for inflation-indexed US Treasuries. But the bulk of performance data was skewed to the downside in the kick-off month for 2016.
Continue reading →

● US GDP fizzles in the fourth quarter | MarketWatch
● US consumer confidence cooled in January | Bloomberg
● Chicago PMI surges in January | MarketWatch
● PMI: China’s mfg sector contracts more than expected in Jan | Reuters
● Eurozone factory growth slows at start of 2016, PMI shows | Reuters
● Oil falls 2% on China data, fading prospect of OPEC action | Reuters