By: Scott Davis 

Folks, in the link below please find our latest Melius Macro Views slide deck. Key takeaways below:
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  • 3Q earnings saw widest range of results we can recall, but overall points to a cycle still on track
  • Diverging short cycle (weak) vs. long cycle (still strong), opex (inventory destock) vs. capex (strengthening), U.S. (accelerating) vs. China/Europe (slowing)
  • Melius Sentiment Index slowing, but still in expansion territory…back tests very well with the industrial cycle
  • Industrial stocks again on track for 2nd worst year in three decades…pricing in a mild recession
  • We see value opportunities in factory floor names in Multi-Industry and select Machinery stocks

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