Mixed Messages

Client Talking Points

Mixed Signals from Asia

Two major markets in Asia went in distinctly different directions overnight. In China, flash PMI for March, an indication of overall manufacturing conditions, strengthened and the Shanghai Composite index remained bullish on TRADE and TREND durations. In South Korea, though, the Kospi is now bearish on TRADE and TREND durations.

Mixed Signals from Europe, Too

In Germany, manufacturing PMI for March slowed to 48.9 from February’s reading of 50.3, but the Dax held its TRADE and TREND support levels. Meanwhile, France’s March PMI plunged, and that snapped our TRADE support level.

 

 

Asset Allocation

CASH 37% US EQUITIES 24%
INTL EQUITIES 15% COMMODITIES 0%
FIXED INCOME 0% INTL CURRENCIES 24%

Top Long Ideas

Company Ticker Sector Duration
DRI

Darden stands to be a beneficiary from a housing recovery and an improved employment picture, which boosts casual dining trends. Also, another earnings guide down could lead to management or strategy change, which is bullish for the stock.

 

HOLX

HOLX remains one of our favorite longer-term fundamental growth companies given growing penetration of its 3D Tomo platform and high leverage to the 2014 Insurance Expansion from the Affordable Care Act.

FDX

With FedEx Express margins at a 30+ year low and 4-7 percentage points behind competitors, the opportunity for effective cost reductions appears significant. FedEx Ground is using its structural advantages to take market share from UPS. FDX competes in a highly consolidated industry with rational pricing. Both the Ground and Express divisions could be separately worth more than FDX’s current market value, in our view.

Three for the Road

TWEET OF THE DAY

“Math is a beautiful thing.” -- @codertrader

 

 

 

QUOTE OF THE DAY

“The greatest obstacle to discovery is not ignorance – it is the illusion of knowledge,” – Daniel J. Boorstin

STAT OF THE DAY

27, the number of points that the Miami Heat trailed the Cleveland Cavaliers last night before storming back and winning their 24th straight game