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Welcome back everybody live on the floor of the New York Stock Exchange and this is the first.
Day where we've been able to trade up on the -- in the wake rather of the downgrade of US's credit rating by S&P joining me now.
Alec young was from S and -- and equities division Alec thank you for being here for it was great to be here all right we won't get into Terry Duffy make it a comment that the S&P downgrade was a -- you're on the equities side -- Talk about this market reaction.
It wouldn't soft that doesn't He had downgraded the US credit why haven't you anticipate -- this exactly what you anticipated a selloff to this magnitude more or less.
I think this selling is a little bit more than I expected I mean the thing that was interesting about the timing of the downgrade Friday as it came on the heels of one of the worst -- runs to Begin with the we're ready very oversold the market and re price itself for weaker broad.
As we had a lot of this -- economic data I think what we're seeing today is that this is never happened before it's bad headline effect that's shock effect its something that really no one has any.
Any you know score card that they can go back and look at in terms of how this plays out I thought we might see this contain awarded the damage in the futures this morning.
We're getting down 67% earlier definitely taken -- back was a little bit more.
Then than I expected having said that we're viewing this more as an opportunity.
To look for bargains especially in the non financial states we've been underweight the banks.
The financial sector for a while banks are getting killed today a lot of them hitting 52 week lows for example Bank of America Goldman Sachs you stay away from those and what are you -- who had been overweight consumer Staples for most of this correction since may seventeenth.
That's the number one performing sector in the -- were continuing to stay with back.
We're looking for good emerging market sales footprints.
Rising and high quality dividend yield so we think if you're applying equality screen there's more value to be added by looking for bargains today.
Then there is you know throwing the baby out with the bath water.
You talk about -- pointed out earlier that.
At one point today -- for example was at the -- dollars and ninety cents I mean that's the highest in more like fifteen for the year.
I Tobin Smith of change -- the told me earlier set on -- reported at ten dollar while -- below ten dollars a bargain hunting for smart people.
But I'm talking to traders here and they're saying -- the hedge funds are just simply trying to raise cash almost that sort of next emergency.
Right I mean clearly.
There's a lot of and some.
-- -- Any attempts -- bargain hunting over the last few days have not worked so there's a lot of here but that's generally what you see at bottom so there's a couple strategies -- -- dollar averaging.
If you do you wanna nibble typical toe in the water stay with -- stay with -- don't put all your eggs in the market today.
You know don't don't overreact in the spirit of panic do things gradually.
But I think anyone that's investing for more than a 24 hour time horizon which most people should be but it shouldn't be in the stock market I think they're probably -- be pretty well rewarded looking back six months.
A year from now if they if they -- did a rather than sell.
And you know I I've tried to say this to our viewers that the really smart money for example the Warren -- of the world would come in and start nibbling around and find something like this but.
Recession people talk about the double dip possibility do you see them.
And He gets the biggest risk to this event is it enough to tip us into a double that we don't fix up.
Clearly the data has weakened recently our economists to increase their odds of recession I think there are 35% right now but they're still well below.
You know a high probability that we see weak growth as the most likely scenario for the next year but at this point we think that's probably.
Factored into the market.
Alec young SMP equities not the guy who -- -- pound -- -- -- -- -- -- thank you so much my pleasantly I really appreciate that He ran down here he's got to go he's got a lot of work to do we.
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