International Trade and Economics — Alpha.Sources

US Equity Sector Rotation Chartbook, May 2026 - The Unholy Alliance

The May 2026 edition of the US equity sector chartbook can be found here, with accompanying portfolio statistics here

I have made quite a few changes to the chartbook since the last time I ran it. I have changed my data provider from Investing.com to SheetsFinance, which makes it much easier to update the spreadsheets feeding the Python scripts that generate this, and any other market-data chartbooks, that I am using. The data now reflect one-year trailing total returns with daily observations—approximately 250 trading days per year. I have also added a cross-correlation rotation matrix, which tracks shifts in sector correlations with IVV, along with chart plots of rolling correlation Z-scores.

Global Leading Indicators, February 2026 - Upturn confirmed; will it slip in rising oil prices?

The February update of the global LEI chartbook confirms that a broad-based upturn in global cyclical activity has been underway since the end of the third quarter last year. Granted, the number of LEIs currently in expansion—16—is slightly lower than at previous cyclical peaks. However, the February update and revisions point to a stabilising expansion at this rate, which remains robust overall.

The big question now is whether the upturn will falter in the face of the energy price shock ignited by the war in Iran.

Time will tell.

Global Leading Indicators, October 2025 - In the Pipe, Five by Five

Equities have wobbled a bit recently, without any obvious catalyst, aside from the most apparent one: they’re expensive by nearly all historical valuation measures. Many investors now appear concerned that the end of the U.S. government shutdown will trigger a deluge of data, potentially revealing that the economy is weaker than expected. That fear, however, doesn’t quite align with the sell-off in the December 2025 SOFR contract, which is casting doubt on what had once seemed a near-certain Fed rate cut in December.

Global Leading Indicators, September 2025 - Tariffs, what tariffs?

The September 2025 edition of the global LEI chartbook can be found here. Additional details on the methodology are available here.

One point on the methodology that I may not have made entirely clear: the aggregate LEI diffusion referred to below—and shown in the first charts of the chartbook—is not the same as a standard diffusion index. It is calculated as the sum of two figures: the number of LEIs that are high and rising minus those that are high and falling, and the number of LEIs that are low and rising minus those that are low and falling. This approach is designed to provide a more accurate turning point signal than a simple diffusion index. For the September 2025 edition specifically, the value for the G20 LEI, shown on page three of the chartbook, has been extrapolated to reflect a small rise. This mirrors the increase in the G7 indicator, as the G20 value had not yet been updated when the data was pulled from the OECD.

I seem to have a knack for releasing these chartbooks just as markets are hit with a curveball. The August edition came out in the wake of the soft August payrolls report, which opened the door to a dovish shift by the Federal Reserve and rattled investor sentiment with renewed concerns about a potential slowdown—or even a recession—in the U.S. economy.

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