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Always do well the Dow may be breaking.
A five week winning streak today the NASDAQ and the S&P as well three weeks -- nice gains may be ending the markets are really watching Cyprus.
As that small island scrambles to avoid a financial crisis that could hurt.
Other countries -- contagion could spread to other countries Chad Morgan -- -- -- portfolio manager.
Is -- -- not -- say that three years from now the European monetary union's gonna let.
Completely different than what we have right now correct and.
Cyprus is a small issue -- -- since fully suspect that there will be a band aid put on that courtesy to troika and the ECB.
But the real issues with in the Euro zone.
He's the political winds are shifting to more of a populist kind of vote so when you take a look at Italy for example and you have grill -- which.
It is very quite Euro are opposed to -- Euro being part of the Euro zone.
He's gaining traction and what we're expecting to see here is there's some of the weaker nations perhaps.
I eat easily bail out of -- the Euro -- which doesn't mean has the catastrophic.
For the financial system at all -- but nonetheless you know three years from now it -- looks to me.
-- basically saying Cyprus is willing to go -- needs to go but you know one of the things that I'm watching very closely is the US dollar vs the Euro what we have seen international investors.
Taken at safety play and going to the US dollar moving away from the Euro I mean that that exacerbates.
There -- problems also also.
The fact that you had the Euro zone economy.
Actually contracting at greater than a half a percent a year and it's gonna look like that for 2014.
And for -- -- Q1 of this year the United States actually grew at a GDP rate of 3%.
Which is extraordinary.
Let's get to the US markets because a couple of things happening over on the side of the pond -- -- want to address first and foremost.
You got the Dow which is looking to break a five week winning streak S&P NASDAQ three weeks of gains.
That's ending so at this point with the -- -- and -- appear that paused that we seem to be saying.
I'm curious if you think that that this is going to be -- Short term pause or a long term -- -- -- for US market think we're at this point in time where it's now the -- -- part of the market cycle.
Where you've had this liquidity -- and rally courtesy of the Federal Reserve.
The ECB Bank of England bank of Tokyo now and now you're gonna have to see that a time hand to hand off to -- earnings driven.
As well as an economic cycle and -- what you could see happening here is that earnings are relatively flat for Q4 as well as for Q1 which we're gonna go into -- Calling S&P 157.
S&P call of 1575.
But you're saying that were fairly valued in a 105 dollars per share -- -- earnings per share estimate for the S and Kate that doesn't that's a lot of growth right there.
No it isn't -- -- hearing in 2012.
You had -- 992 on draws a share we're looking for 5% upside.
The street's expectations are more like a 113.
And I got it again bring -- back.
For Q1 of this year expectations.
By a -- economists and market strategist is actually year over year -- -- earnings to not ground to actually beef.
Slack you do have a couple of -- -- wanna get too because what we saw yesterday in particular the technology sector was some weakness and there's been some concern I think is about as apple.
But -- what a couple of technology and I think is interesting -- -- -- That's when your pecs and -- also like IBM big boy is still standing -- -- this -- up about 9% the last six months.
What he's saying in that action the last six months on -- that we need to look at to Cisco's.
A value play it has about four dollars of cash per share on -- balance sheet they're gonna turn around two dollars a share and trading at 21.
To cut the company's revenues are growing in -- consistent manner.
Operating margins -- actually improving and of course it's well capitalized so if you do you get an uptick.
We think economic growth on a global basis Cisco will actually benefit from.
Are you -- the same thing about IBM if you look at the charts of IBM in the year to date it's up about 10%.
Really had not been a big mover in 2012.
But do you that your regular number that six sponsors -- -- -- -- -- -- -- -- you have value play here you have -- trading.
At a below market multiple.
It has had a consistency.
On its revenue line for the last several years an operating margin expansion to tax sector as a whole.
Is quite undervalued -- confined.
Growing profitable well Travelers Cos.
that are selling at below market multiple chat Morgan Lander it's always good to see you and you know thank you for having played as we get out for the -- -- -- thank you -- --
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