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Ameriprise Financial chief market strategist David Joy argues budget cut talks could trim economic and market momentum.
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The market's been and it's hair this year the SP 500 up more than 5%.
At first guest manages nearly 700 billion dollars and he says that those budget talks -- -- in up in Washington yet they could curb this momentum.
Joining us now David joy chief market strategists for Ameriprise Financial.
Not spreading so much joy today are you so you worry about these budget talks hot.
Well I am a little bit at least and then near term only in the sense that it's looking increasingly as though there's going to be a stalemate rather than a compromise which could trigger these sequestered cuts.
And that's gonna -- some of the economic momentum that we have been.
That combined with the fact that were -- were struggling to get beyond the 141000 level on the -- is struggling to get much beyond 15100 on the S&P.
Suggests to me that maybe would do for a little the pullback in this is going to be the Cadillac.
-- -- you know a lot of people I think open that one day we can take Washington.
Out of arm market research but it's not looking that way is -- here we are again Washington determining where the market's going.
Yeah that's absolutely right I think although I think the mindset is changing a little bit I think previous to this that was always the expectation that.
There was going to be some definitive.
Conclusion to these budget tar -- You know long term deficit reduction and now I think the mindset is changing.
To an accommodation.
And expectation that which is gonna go from one.
Political crisis to the next.
And this is going to be a chronic state of affairs so we're just gonna have to Lebanon.
And I mean for those of us -- -- -- fundamental announcements you can pretty much that I have the wind up.
You do manage the 700 billion dollars so let's talk about where -- putting some of that money these days and the sectors you like.
The industrials financials and energy all kind of lead me to believe that's a positive sign for the economy right.
It is I think we're in the early stages of the cyclical upturn that's happening in United States it's happening in China.
You saw some decent news coming even out of Germany today I think that's the direction we're headed I think.
Global GDP probably gonna struggle this year overall but -- to turned a corner right thing.
Now that suggests that some of these cyclical issues should take over the leadership of the market.
Doesn't mean you should turn your back on dividend paying stocks the defensive categories they'll still be okay.
But I think the growth.
Leaders are going to be be cyclical sectors.
-- it's nice to hear the financials coming back more and more people talking about them do you think that they've cleaned up finally from the financial crisis are you just picking.
Certain banks in particular.
No I think by and -- the banking system especially in the US is much healthier balance sheets are pretty good capital levels have been restored.
But also just in terms of general economic activity loan demand right asset prices rising generating a good revenue I think the financials and in general look pretty good here even though -- out of -- front.
And energy as well -- here -- -- are about this energy boom coming to the United States.
Is it natural gas what part of the sector you playing here.
Well and I think there were two things here one is just -- if if the world is in the early stages of the cyclical upturn you're going to see more demand for all types of energy including -- But in the US I think this natural gas.
Renaissance is an important long term theme.
I wouldn't play it by eight.
Generating.
Sensitivity to the commodity but rather the infrastructure that's going to be needed to build out.
In order to get this gas to the marketplace that's gonna happen and it's gonna take several years to play out.
It's great stuff David.
