Answer: Macroeconomic conditions.

A top-down analysis begins with an assessment of macroeconomic conditions. Analysts evaluate the current and forecasted economic environment to identify markets and industries expected to perform well. Subsequently, specific companies within these industries are selected for investment. This approach contrasts with bottom-up analysis, which focuses on company-specific factors such as management quality and business prospects, rather than broader economic or industry trends.

Author: LeetQuiz Editorial Team