Consumer spending in the retail sector fell 0.3% in March, well below expectations for a modest increase, the US Census Bureau reports. The news is just one data point and so all the obvious caveats apply. Nonetheless, taking the numbers du jour at face value sends a dark message, in part because the reversal in sales last month took a substantial bite out of the year-over-year trend.
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Yesterday’s post focused on the discouraging record for value investing over the last decade, but history looks even worse for the so-called small-cap premium in the US stock market. Yes, there have been periods when small cap shines relative to large caps, but the strategy has been a loser as a buy-and-hold proposition since 1980, based on Russell indexes. Excluding the “junk” or focusing on the “value” opportunities in the small-cap realm offers possible solutions, but the original concept using the Russell benchmarks is battered and bruised.
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● Small-business sentiment falls to 2-year low in March | MarketWatch
● U.S. Import Prices Rose 0.2% in March Amid Signs of Inflation | WSJ
● Redbook: US same-store sales +1.1% in Apr but off 2.8% mtd | Econoday.com
● The IMF downgrades global growth again | The Economist
● China’s jump in exports soothes growth fears, boosts markets | Reuters
● Eurozone Industrial Output Falls In Feb After Strong Jan | RTT
● Rise of Institutional Investors Raises Questions of Collusion | NY Times