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Summer Stock Picks

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  • Description

    Wells Fargo Advisors Senior Equity Strategist Scott Wren on where to invest in today's market.

  • Duration 5:09
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This transcript is automatically generated

Earlier this week.

-- our next guest has over thirty years of management a money management experience -- he started when he was six.

Scott -- senior equity strategist for Wells Fargo advisors -- designers wanted to confirm forever and you analyze president -- sides got the united -- diapers it.

That's no problem.

I don't -- is rebounding a little bit today are we sort of in this trough right here what what's your view of.

Where this pullback stands got a little bit more to go -- you think we're poised for a.

Bounce you know I I think I think.

You know we have a lot of technical support coming in here the 200 day moving average we have the long term -- support off of the march 09 -- so.

I think that's what's kinda held -- -- here but.

But my feeling is that we're going to test that harder to expect a big sell -- no but you know we're not going to be this close to these critical technical support levels.

Without giving it a pretty -- -- so I think that's probably largely responsible for the bounce we've had today -- a course a little bit better.

News coming out of Greece so you know the market held -- pretty well last week when you know -- you look at that all the data we had out which was just a -- You know 78% of it was below expectations so.

-- -- did these technical.

I'm not detect acquire analysts here to Wells Fargo advisors but these technical levels I think -- kind of kept -- -- here so far.

Be great to be a fly on the wall on your trading floor they're curious what kind of concerns and questions your clients haven't high -- advising these days because there's so much uncertainty stocks are up and down the geopolitical risks are so abundant.

Well you know it really -- there there is -- and you know it seems like we're -- a heightened point of event risk and and but really when you look back over history you know we're always susceptible to various events but.

But right now I think our clients are are really.

Worried about the Middle East they're worried about -- European sovereign debt issue.

They're concerned that the recovery that we've seen so far is starting to Peter out and and really the global recovery itself.

You know we've obviously hit a soft patch so right now for us what we've been trying to talk her clients about really for the last two and a half years we've we've we've leaned.

Pretty hard cyclically for this recovery.

I think we're -- a time out period right now I think net net this year were not going to see much much movement from point a to point B in the major indices although we're gonna.

See volatility so we want them to be prepared.

For the next leg up in this cyclical bull market now of course the problem is it's probably not going to start until some time you know very late this year and 2012 so.

You have to preach a little bit of patients a little bit -- neutrality.

You know disease defensive sectors have performed a little bit better so.

How we don't want our clients to get real defensive were were only really at about the middle of this economic cycle I think there's more -- -- and that's gonna play out over the next couple years.

Couple and -- that you are accumulating right now are defensive health care name's it Express Scripts and Praxair aren't there.

-- -- really guys that for the last few years then.

On fox I don't think -- have given you any defensive types of names but I thought.

Really over the last month or so that I've been on -- defensive name here and there is good and one of those is Express Scripts.

You know really does Express Scripts health care.

Defensive.

They do a lot of claims processing they do a lot of distribution of drugs.

Generics are good margin business for them in this patent cliff type situation for these major pharmaceuticals is going to help another name that I passed -- view.

I was Praxair and one thing about Praxair is 50% of the revenues come from overseas I like that.

And then also they have exposure to the health care industry defensive.

And also to industrials which is obviously cyclical so we want to keep that cyclical bias.

But we're not -- nearly as hard were a little more neutral.

Then we had been for most the last two and a half years.

What consumer discretionary it's interesting we're seeing the Staples in the spending there really pick up and that's offering a lot of support of late.

Well I think as far as the consumer discretionary sector you know that had a great performance -- early in the cycle it really outperform.

Well before the recession was over for us you know we've been even -- consumer discretionary here for awhile I think that's the right way to be.

Probably 44 most of the rest of the cycle you know Staples on the other hand have had some better performance here here lately they're very defensive.

But I think this this defensive performance -- we're seeing right now.

It's a temporary type of thing I mean you'll see health care Staples utilities Telecom.

Those types of sectors.

Do a little bit better in this in this kind of transition phase when people are wondering what the Federal Reserve's going to do with interest rates.

When they're wondering if the economic recovery is going to continue.

So you know in this timeout period and I don't think we're going to see much net change in in major indices this year.

These defenses tend to do a little bit better but but you do not want to at least in my opinion you do not want to we.

Hard defensively because this cycle.

It has it has a ways to go on my opinions ultimately Scott -- Wells Fargo advisors thank you so much sir.

Our thanks guys yeah.

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