Research from Water Tower Research, Water Tower Research

Water Tower Research

Research from Water Tower Research

Water Tower Research is a leading equity research firm that provides research on micro, small and mid cap companies.

Water Tower Research was founded by Wall Street veterans after witnessing a fundamental shift in the investment research industry with the result being a declining knowledge base among investors, a lack of awareness and a shrinking pool of fundamental research being conducted on companies across the small-cap and micro-cap spectrum. The same issues are now increasingly occurring in the mid-cap space. This sea change within the investment community is impacting not only the companies themselves but also current shareholders and potential investors. With significantly less active sell-side sponsorship by Wall Street, a substantial information gap has developed between companies and various constituents in the financial community. The net result is fewer channels for insight and information to flow between companies and investors.

Equity Research Firm

Thematic (Sector/Industry)

<ul><li>Broad equity indexes booked their fourth straight week of positive returns, with the MSCI World Index and the S&amp;P 500 up 1.23% and 0.79%, respectively.</li><li>Small caps followed suit, with the Russell 2000 gaining 1.48% this week.</li><li>Cannabis stocks slid for the sixth straight week, with the MSOS ETF declining 0.56%. It was shaping up to be a good week until the MSOS ETF fell 3.97% on Friday.</li></ul>

Broad equity indexes booked their fourth straight week of positive returns, with the MSCI World Index and the S&amp;P 500 up 1.23% and 0.79%, respectively.Small caps followed suit, with the Russell 2000 gaining 1.48% this week.Cannabis stocks slid for the sixth straight week, with the MSOS ETF declining 0.56%. It was shaping up to be a good week until the MSOS ETF fell 3.97% on Friday.

The Highlights : Cannabis News for the Week Ending April 14, 2023

Global Multi-Asset Investment Strategist, True Insights

Jeroen Blokland

Global Multi-Asset Investment Strategist

Build Well-Diversified Multi-Asset Portfolios

True Insights

Our research helps investors build well-diversified multi-asset portfolios and profit from market developments. In addition, our unique and proven Macro – Sentiment – Valuation (MSV) investment framework ensures a consistent flow of new investment opportunities. Together with our market views, these opportunities will be reflected in our live ETF-based Global Multi-Asset Portfolios.

Cross Asset Strategy

<ul>
<li>We have to go back to 1980 to find a month when small US businesses thought it was an even worse time to expand.</li>
<li>Volatility is falling off a cliff as investors embrace a new kind of goldilocks. </li>
<li>A common denominator drives Bitcoin and Gold higher: their perceived value as insurance against adverse market circumstances.</li>
</ul>


We have to go back to 1980 to find a month when small US businesses thought it was an even worse time to expand.
Volatility is falling off a cliff as investors embrace a new kind of goldilocks. 
A common denominator drives Bitcoin and Gold higher: their perceived value as insurance against adverse market circumstances.


Sentiment Strengthens, While Fundamentals Fade

Macroeconomics

<ul>
<li>The 3-month annualized change of all six CPI measures in our US Inflation Monitor fell compared to February.</li>
<li>Given the levels of inflation and its poor track record, the Fed will want to put one extra hike in to be ‘better safe than sorry.’</li>
<li>The odds markets will win this battle with Powell are increasing, but only because so is the likelihood of a recession.</li>
</ul>


The 3-month annualized change of all six CPI measures in our US Inflation Monitor fell compared to February.
Given the levels of inflation and its poor track record, the Fed will want to put one extra hike in to be ‘better safe than sorry.’
The odds markets will win this battle with Powell are increasing, but only because so is the likelihood of a recession.


The Market’s Triumph over the Fed: Winning by Losing!

<ul>
<li>Stock indexes finished the holiday-shortened week almost exactly flat, as the MSCI World Index and the S&amp;P 500 ended at 0.01% and -0.05%, respectively.</li>
<li>Smalls caps followed suit, with the Russell 2000 down 0.01%.</li>
<li>As has been the trend lately, cannabis stocks declined. The US cannabis-focused MSOS ETF dropped 6.36%, led by Curaleaf (CSE: CURA, OTCQX: CURLF), which was down 15.35%.</li>
</ul>


Stock indexes finished the holiday-shortened week almost exactly flat, as the MSCI World Index and the S&amp;P 500 ended at 0.01% and -0.05%, respectively.
Smalls caps followed suit, with the Russell 2000 down 0.01%.
As has been the trend lately, cannabis stocks declined. The US cannabis-focused MSOS ETF dropped 6.36%, led by Curaleaf (CSE: CURA, OTCQX: CURLF), which was down 15.35%.


The Highlights : Cannabis News for the Week Ending April 7, 2023

<ul>
<li>Cracks are appearing in the US labor market, bringing relief for the Federal Reserve concerning inflation. But higher unemployment significantly increases the odds of a US recession.</li>
<li>The increase in Federal Reserve liquidity is keeping markets afloat. But assuming the banking crisis does not worsen from here, liquidity will reverse.</li>
<li>Our Fear &amp; Frenzy Sentiment Index moved away from ‘Frenzy’ but remains in Neutral territory. Futures positioning and equity flows worsened, pushing the Fear &amp; Frenzy Sentiment Index toward ‘Fear.’</li>
</ul>


Cracks are appearing in the US labor market, bringing relief for the Federal Reserve concerning inflation. But higher unemployment significantly increases the odds of a US recession.
The increase in Federal Reserve liquidity is keeping markets afloat. But assuming the banking crisis does not worsen from here, liquidity will reverse.
Our Fear &amp; Frenzy Sentiment Index moved away from ‘Frenzy’ but remains in Neutral territory. Futures positioning and equity flows worsened, pushing the Fear &amp; Frenzy Sentiment Index toward ‘Fear.’


Weekly Market Monitor 14 - Did the Fed Finally Break the US Labor Market?

United States

The MSCI World Index is a free-float weighted equity index. It was developed with a base value of 100 as of December 31, 1969. MXWO includes developed world markets, and does not include emerging markets. MXWD includes both emerging and developed markets.

MSCI World Index (MXWO INDEX)

The Highlights : Cannabis News for the Week Ending April 14, 2023

Broad equity indexes booked their fourth straight week of positive returns, with the MSCI World Index and the S&P 500 up 1.23% and 0.79%,...

Water Tower Research

Sentiment Strengthens, While Fundamentals Fade

Sentiment strengthens, while Fundamentals fade. 30+ charts to get you up to speed on all things Macro, Sentiment, and Valuation, and why you should...

Jeroen Blokland

The Market’s Triumph over the Fed: Winning by Losing!

Winning by Losing! The odds markets will win this battle with Powell are increasing, but only because so is the likelihood of a recession.

Jeroen Blokland

The Highlights : Cannabis News for the Week Ending April 7, 2023

Stock indexes finished the holiday-shortened week almost exactly flat, as the MSCI World Index and the S&P 500 ended at 0.01% and -0.05%,...

Water Tower Research

Weekly Market Monitor 14 - Did the Fed Finally Break the US Labor Market?

Welcome to the weekly Market Monitor, keeping you updated on the week’s most important charts and developments in financial markets.

Jeroen Blokland