As we head into a new week filled with uncertainty after the horrific terrorist attacks in Paris, one thing is clear: While U.S. growth remains relatively resilient, global growth continues to slip. Last week the OECD cut its estimate of global growth for the second time in three months. The organization now expects the global economy to grow 2.9 percent this year and 3.3 percent in 2016, down from previous estimates of 3.6 percent for both years.

​Part of the problem is that emerging markets, an engine of growth for much of the past decade, continue to decelerate. Last week provided more evidence of the slowdown in China. Exports are now down 3.6 percent from a year earlier while both inflation and industrial production are decelerating, according to Bloomberg data. Elsewhere, Friday’s multiple terrorist attacks in Paris reinforce the significant threat that global terrorism represents throughout the world. From an economic perspective, the fallout from these attacks will likely put some pressure on the French economy as well as the euro.​

In the meantime, the sluggish global environment is impacting markets and has several implications for portfolios, as I write in my new weekly commentary, “Yield: One Commodity That’s Still Hot.”

Along with a strong dollar, tepid growth is pushing down analysts’ estimates for 2016 earnings. Estimates for S&P 500 2016 earnings have fallen by 2 percentage points over the past five weeks, Bloomberg data show. Should the dollar continue to rise and/or global growth remain sluggish, they may have further to fall.

In addition, slow global growth implies more monetary easing by most of the world’s central banks. Even before the Federal Reserve (Fed) raises rates, easing by central banks in Europe, Japan and China may put further upward pressure on the dollar, resulting in a de facto monetary tightening. In turn, a strong dollar is helping to keep a lid on inflation.

Showing Page 1 of 2