Two economic dynamics are driving capital markets. First, GDP strength which, by many measures, remains steady if not buoyant. One of our favorite contributors is Caterpillar. 

Hard to think of a better representative of cyclical industrials than the Peoria, IL-based manufacturer of heavy “yellow-iron” equipment. The company reported a 12% revenue increase to $16.8 billion for 3Q, from $15 billion in 3Q 2022. Operating profit margins were up, 20.5% vs. 16.2% on higher demand for energy and transportation-related construction.

For more defensive sectors, the Gryphon Index (derived from Churchill’s senior debt portfolio) showed revenue and Ebitda improvement of 14.5%, year-over-year through June 30. This includes both organic growth and add-on acquisitions (see our Chart of the Week).