Salient to Investors:

  • Rotating into defensive industries has been a losing strategy for the third straight year as personal spending, manufacturing and inflation have exceeded analyst forecasts.
  • The median projection says Q2 GDP grew 3.5 percent.
  • Inflows into health-care and utility ETFs exceed $3 billion in 2014 versus $580 million inflows for tech ETFs and outflows of $3.4 billion for consumer discretionary ETFs.
  • Jeff Korzenik at Fifth Third Bancorp said the jobs report is a clear sign of continued and accelerating economic strength, and says the cyclical leadership in many ways will become more pronounced.
  • Doug Ramsey at Leuthold Group said the very broad move to new highs generally means that the earliest the bull market would top out is 4 to 6 months out at a minimum.
  • Oliver Pursche at Gary Goldberg Financial Services is surprised that the overall risk-off attitude being reflected in fixed-income markets has not caused outperformance in high-quality, dividend-paying stocks.
  • Analysts estimate profits at semiconductor makers to increase 34 percent in 2014 versus 7.5 percent for the S&P 500.
  • Robert Pavlik at Banyan Partners expects a stronger market as consumers grow a lot more confident as the economy starts to show a slight improvement.

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