Global business cycle analysis: The US stock market has global exposure, which may warrant allocating toward or away from domestically focused sectors, depending on the phase of the US business cycle relative to the rest of the world. When the US business cycle is more favorable than the global cycle, sectors with more global exposure are likely to face greater headwinds to revenue growth, while more domestically linked sectors could fare relatively well. The business cycle, which reflects the fluctuations of activity in an economy, can be a critical determinant of equity sector performance over the intermediate term. A typical business cycle features a period of economic growth, followed by a period of slowing growth, and then a contraction, or recession. A cycle is an event, such as a price high or low, which repeats itself on a regular basis. Cycles exist in the economy, in nature and in financial markets. The basic business cycle encompasses an economic downturn, bottom, economic upturn, and top. Cycles in nature include the four seasons and solar activity (11 years).