Keyword: divergence

Divergence Between the 2-Year U.S. Treasury Yield and the U.S. Dollar Trump wants a weaker US dollar, but could the dollar weaken in the coming months? Image: Legg Mason

U.S. Corporate CCC-Rated Bonds Diverge During Trade War As the chart suggests, CCC-rated bonds are not the canary in the coal mine. The divergence in option-adjusted spreads between CCCs and higher-rated issues reflects the impact of the US-China trade war. Image: Arbor Research & Trading LLC

U.S. Corporate Profits vs. S&P 500 EPS The current divergence between large-cap profits and the rest of the economy is the widest on record. It is possible to close the gap “down” (recession) or “up” (reflation). Image: BofA Merrill Lynch Global Research

U.S. Cyclicals/Defensives vs. ISM Manufacturing PMI Chart showing the large divergence between U.S. cyclicals/defensives and the ISM Manufacturing PMI. Eventually, the gap should close soon. Image: Topdown Charts

S&P 500 Index vs. U.S. High Bond Yield Spread Chart showing the current divergence between U.S. equities and high yield bond spreads, while they are generally correlated. Image: Jeroen Blokland

Value Stocks vs. Low Volatility Stocks Chart showing the large divergence between value stocks and low volatility stocks, like never before. Image: J.P. Morgan

S&P 500 Index and UBS Weighted Global Growth Surprise Index The divergence between the S&P 500 Index and the global growth surprise index could explain why this bull market is so hated. Image: Swedbank Research

Global Consumers (Housing and Retail) vs. Confidence (Soft Data) Chart showing the large divergence between global hard data and confidence (soft data). Confidence still refuses to rebound. Image: Arbor Research & Trading LLC

U.S. Fund Flows Chart showing the large divergence between flows into equity funds and those into cash and bonds. Image: Goldman Sachs Global Investment Research

Inflation, Hard Data and Soft Data Hard data are back above long-run averages. But the chart clearly shows the divergence between hard data and soft data. Image: Arbor Research & Trading LLC