Citigroup’s recently published its Global Equity Quarterly report to clients.
It includes the favourite charts of the firm’s regional strategists.
Tobias Levkovich, Citi’s top U.S. equity strategist, submitted a chart of credit conditions, which is a leading indicator of stocks.
Here’s some of the commentary that Levkovich provided with his chart:
Evidence that the economy has accelerated, predicted by improved domestic credit conditions nine months earlier, has pushed US equity prices higher since January, with the S&P 500 slightly below its 2007 all-time high while the DJIA already has exceeded its prior peak. US equities appreciated 10% in 1Q13, with Japan being the only other major developed market to post better returns. Market strength was anticipated for 1H13, but we suspect some volatility could descend in early 3Q13 given Europe’s tight bank lending standards holding back any chance for a second half recovery…
Levkovich expects the S&P 500 to close the year at 1,615.