As we enter the second half of the year, the U.S. economy remains in the middle stage of an expansion that we believe still has plenty of room to run. Private sector job creation reported early this month reflected acceleration and the strongest six month readings since 2006 – dropping the unemployment rate to 6.1%. This and other supporting data reinforces the need for a cyclical bias in equities for the remainder of 2014. This environment should provide continuing support for U.S. and foreign equities, and we expect it will at some point initiate an upturn in global bond yields. We are beginning to see encouraging signs from the global economy. This should work to the benefit of corporate earnings, which can then feed back into more support for equity gains in 2014, which have had a reasonably good year in the U.S. so far.
Click the following link to read the complete PDF: GIM Market Commentary 07-15-2014