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research report

Globe editors have posted this research report with permission of Rosenberg Research. This should not be construed as an endorsement of the report’s recommendations. For more on The Globe’s disclaimers please read here. The following is excerpted from the report:

This is Strategizer, a monthly model-driven report, well suited for active investors. It’s an effective risk-management tool, providing scorecards and expected future returns for global stock markets, equity sectors, bonds and currencies.

This month’s highlights:

Following the continued sell-off in equities last month, Strategizer’s model scores only showed modest improvements.

That said, there were two developments worth highlighting: i) the TSX outlook shifted from below-average to average returns (a step in the right direction); and ii) our Asia ex-Japan model flipped “overweight” from “neutral.”

Our Treasury bond duration model is further emphasizing its counter-consensus “overweight” call — improving to levels not seen since 2011.

Strategizer’s U.S. dollar outlook sunk further, hitting maximum bearish scores while upgrading its view on the Japanese yen to maximum bullish.

In our monthly theme, we highlight how the multiple compression this year has been particularly pronounced in the most expensive segment of the market and what this means going forward.

We do not think the valuation adjustment is complete, which argues for further downside in U.S. equities.

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