Investment Newsletter: Stock Market & Investment Strategies
HELPING YOU NAVIGATE A TOUGH INVESTMENT ENVIRONMENT
DECISION MOOSE-- Global Investment Markets
Executive Summary-- JUL.17.2026
GLOBAL MARKETS: WEEK’S ACTION—Risk-OFF (1)
THIS WEEK the 1st Risk-OFF week after two MIXED-Risk weeks.
US Stocks DOWN, Foreign Stocks DOWN, Bonds DOWN and Gold DOWN.
MARKETS RETREAT AS US MILITARY RESPONDS
Last week the memorandum of understanding between Iran’s Islamic Revolution and the US unraveled. This week the tit-for-tat escalation rolls on but appears contained. Oil markets and shipping have been affected, but the strait has seen intermittent disruptions rather than total closure. As a result, oil prices are above $80 (+14.0%) on the week, but nowhere near the $120 high reached in March. That pushed the commodity complex higher (+5.3%) but left long bonds (-0.1%) unfazed after very cool June CPI, PPI, and Ex-Im inflation data offset the commodity spike. The ten-year yield actually dropped 3 bps to 4.54%. Lower yields helped weaken the Dollar (-0.2%) but not enough to ameliorate the retreat in gold bullion (-2.3%) and foreign equities. Offshore, Asia-Pacific (-5.5%), Japan (-4.3%) and Latin America (-1.3%) fared worst after giving back last week’s gains. Europe (-0.1%) extended its previous week’s loss, but not by much. In the US, large caps (-1.5%) led small caps (-0.7%) lower.
GLOBAL OUTLOOK POSITIVE (3 of 4). (unchanged this week). War has the Baltic Dry Index, copper prices and bond yields higher over the last 13 weeks, all positives. Only oil is down for the quarter.
INFLATION: Consumer, Producer, and Ex-Im prices all cooler in June. Oil prices rose this week and are now back above $80 per barrel, but they are still down this quarter. Global inflation per the Fed Check (91) still warrants tightening, but it has improved amid falling oil prices and rate hikes in Europe and Japan.
US ECONOMIC DATA: RETAIL SALES, PRODUCTION DISAPPOINT. HOUSING STARTS, SENTIMENT, SMALL BIZ OPTIMISM BEAT. Recession chances a year out minimal. Financial system health per SOFR-T spread: sound. GDP Now estimate (Q2) UP as of 7/17: 1.7%.
FEDERAL RESERVE: The Fed's balance sheet stands at $6.74 trillion, with the Fed Funds Rate at 3.50-3.75%. Next Fed meeting is in late July (7/29). Fed Chairman Kevin Warsh replaced Jerome Powell May 22. Iran war has spiked inflation fears. Fed Check (91) is improving but remains hawkish since 1/30/2026 (market price of hard assets going up faster than the market price of paper promises.) The odds are 86% that rates will remain unchanged at the next meeting in July. By December, however, a Fed rate HIKE (88%) is the most likely outcome.
INVESTMENT STRATEGIES: Two changes. The GLOBAL Index model switches to US small-caps (IWM) as does the USES model. The TSP model holds small-cap equities (S Fund).
THE GLOBAL INDEX MODEL-- SUMMARY 7/17/2026
INDEX MODEL: SWITCH To US Small-Caps (IWM)
THIS WEEK: SWITCH TO IWM (since 07/13/26.) after (EEM) triggered a stop-loss following June rate hikes in Europe and Japan. US small caps to gained ground as oil prices fell and eased US rate pressures.
Best Alternative: Large caps are technically sound (very bullish) with and positive PMO.
Volatility Alert: It is likely IWM will fill its latest downside gap (249-259) and retest its 200-day before the US/Iran war is put to bed.
The Global Index Model continues to outperform the S&P, all Buy-and-Hold allocations, and the USES and TSP models in a major way.
PERFORMANCE YTD 7/10/26:
INDEX MOOSE +19%
AOA (Aggressive Growth) +8%
AOM (Moderate Growth) +3%
SPY BENCHMARK +9%
2026: Strong gold kept the Index model in bullion to start 2026, supported by the notion of at least one more Fed rate cut in 2026. That support evaporated at the March FOMC meeting when chairman Powell admitted the bank's uncertainty. Meanwhile offshore equities did well with US tariffs ginning their product prices higher, especially emerging (commodity based) economies. Rate increases in June in Europe and Japan dampened interest in offshore equities.
THE GLOBAL INDEX MODEL has been around for 34-years in one iteration or another. It is a momentum-based market timing model the latest version of which compares the relative strength of ETFs representing US stocks (SPY, IWM) and international stocks (EFA, EEM)) along with US Treasuries (SHY, EDV) and Gold (GLD) in order to pick the single best asset class in which to invest your money. Rankings provide the basis for the Moosecalls global financial newsletter, and have in the past been a solid predictive tool. They provide a general direction (stocks, bonds, precious metals, cash) for allocating investment assets. A daily signal, it is provided here for free once a week as a guideline only.