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Security Ballew Wealth Management CEO T. Doug Dale and Harris Financial Group Managing Partner Jamie Cox on the outlook for the markets and the sector...
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All stocks headed for a rally or are -- at risk of a big pullback it is useful to us about it why we have our street fight -- the polls we've got James -- Harris financial group managing partner.
As for the bears we have that she got -- -- security -- wealth management chief investment officer.
Okay see you are calling for about a ten to 20% correction.
We've heard that from a lot of people's it's coming it's coming the first six months it's coming why haven't seen it yet what would be the catalyst for that.
Sure well obviously with everything that's going on in Europe that could be they have put us.
Things going on in China are obviously deteriorating here every year quicker -- surprising.
People as data comes out about what's going on in China with their growth slowdown.
And really what -- just simply say is if -- back on June the fourth the S&P was at 1266.
Today we're over 14100 the market is short term overbought.
Wouldn't take a whole lot my opinion to get marketed come back down to those same levels on a relatively short period of time also bad that is.
All right Jamie let's hear from the other side you say the markets have positioned for a Paul by the end of the year you you don't think there's market is overbought.
I don't think it's overbought and all -- it if you look at specific sectors this and 500 it's absolutely not overbought look at apple today.
We've seen tremendous -- says tremendous buying an apple did there's a lot of exciting things going on the technology even Hewlett-Packard which is at the bottom of the stack is -- A decent run over the past couple of days.
I don't believe that economic data out all believe that at the the unknowns that we keep talking about fiscal cliff in Europe the news cycles.
And that kind of thing you're gonna drive the market down -- actually believe the -- slides sideways for the next couple of weeks.
As a new cycle becomes more more prevalent but we're gonna pop into the election I think we're gonna have.
A much more surprising results of the market.
We're going to be -- probably market throughout going to be this negativity I think probably it JPMorgan's gonna be proven right but he raised his price target for the S&P 500 couple weeks ago he sure.
-- OK -- then that brings us to the question though.
That that if we are indeed if this market where people will start turning away from the bad headlines out of Europe and -- -- so called decoupling from potential -- -- yes decoupling from the bad news.
And looking more at the earnings names where -- the demand com.
That you -- villa's a top it Jamie.
Okay perfect I actually think that four for us some of looking at housing and it's been such a horrible sector for the last couple of years and all the sudden you start to -- A little -- a sign of life and that's fantastically important for banks.
And for people that have been scared to death of buying bank shares over the last couple of years this is one of those things -- to pay attention to.
Because it provides -- the base on which to build long term portfolio -- -- so I think that banking.
Which has been -- headlines in the negative sense for a while this is a good place to be making long term bets on banks that JPMorgan -- deviancy.
I think that would be a very good place to start.
By exceed you've talked about a 20% correction so how -- investors play the market right now do you like gold.
Yeah I do not particularly the gold mining shares.
Behind it.
By the way -- not a total some market bear in terms of all sectors if you look at the gold mining sector in particular.
That sector's been beaten up some 50% in the last twelve months.
That's an area that clearly still has strong secular -- winds associated with all the Central Bank printing of money going on.
I think that's a good.
Hedge position so to speak or via satellite positioning her clients' portfolio to -- -- gold mining stocks.
Lot of them are trading at between ten and fourteen times earnings I'd just rather be buying stocks that are oversold vs -- -- this environment right now.
And then -- banks banks are not a bad place to be either I would argue that there are a little -- short term overbought but I -- -- -- -- let's be honest give a favorite name banking ally -- idea -- -- Wells Fargo wells forests are a great job they went to the 2008 financial crisis.
Relatively well they're obviously one of the bigger banks but I think they're going to be one of the ones that that make it to the end of this deleveraging process that quite frankly it's gonna take a long long time.
And I think you're gonna see equity returns remain relatively low and muted for the next decade just like they were in the past.
That Jamie when you go stock picking you like GE BB&T and tear I've very good to know about -- it's -- -- the heavy machinery dependent on auto rebounding economy.
What do you see with -- Well I think it was a little bit oversold but based on its earnings last week.
At about but I what I really like about it is that agriculture in my opinion is one of those very important sectors and John Deere is completely levered to agriculture so if you like.
Food him all the droughts and things that we have I think you're gonna see that job -- perfectly positioned to.
You know take advantage of that as we move forward in the future but I would like to say one thing about that one of the -- I don't like and that's the defensive sectors like.
Like Verizon and AT&T -- -- -- Telecom companies are terribly terribly overbought that is a sector that I've totally believe is overbought.
Verizon in particular has problems are negotiating with their union right now so be very -- about -- stepping -- that.
Was a good.
I'd love these guys -- come up with good idea thank you so much Jamie Cox and T it down.
