Afterseveralquartersofrobustgrowth, industrialproduction has caught back up withits long-termtrend in all AsiancountriesexceptJapan, SingaporeandMalaysia, according toHSBC.
However, the model also suggests that, if lower interest rates are to revive the economy, a cut of 2.5 percentage points (the size of the cut until this week) would normally be expected to have lifted share prices by 22% within a year, reduced long-term bond yields by three-quarters of a point, and left the dollar 5% weaker.
If Dell can string together a few quarters where the revenue growth cadence points to long-term growth of 4-5% and gross margin holds up, then we expect the valuation multiples to rerate higher.