Personal Finance Insider | The secret recipe for new stock records and the market's biggest fears @InsiderPersonalFinance | Uploaded September 2017 | Updated October 2024, 13 hours ago.
This week:
Business Insider executive editor Sara Silverstein discusses how the stock market has been turned upside down in September. The stocks that were the best year-to-date performers through August have been the worst in September, while those with the weakest returns over the first eight months have led the way higher. A similar complete reversal can also be seen at the sector level, with market-leading tech and healthcare stocks giving way in this month to energy and telecom. This rotation has helped propel US stocks to new records. It seems that whenever the equity market loses a driver of gains, another is ready to step up and take its place.
Business Insider deputy executive editor Matt Turner speaks to Mike Ryan, the chief investment strategist for UBS Wealth Management Americas, about what keeps him up at night. He says that he's most worried about a policy mistake from central bankers, and that his concern is compounded by the fact that current monetary policy is entirely unprecedented. Ryan notes that central banks around the world have greatly expanded their balance sheet, and highlights the challenge around what happens when they unwind that.
Turner chats with Dennis Ruhl, chief investment officer of JPMorgan's US behavioral finance equity group, about his greatest market fears. Ruhl expresses concern over the unwinding of quantitative easing, as well as political developments that could inject volatility into the market. He says the market headwind that has the greatest likelihood of materializing is the natural aging of the current cycle, as wages and interest rates rise.
Mark Haefele, global chief investment officer of UBS Wealth Management, tells Turner that he's most worried about what happens with interest rates and inflation. He also notes that while many geopolitical developments have a short-term effect before being quickly forgotten, the North Korea situation could be different, and is a threat worth taking seriously.
Turner also addresses recent comments from Fidelity's director of global asset allocation research Lisa Emsbo-Mattingly, who noted that the US market may be overdue for a 5% correction, since we haven't gotten one in about a year and a half. Asked about whether investors have been buying as the stock market has hit new highs, Turner cites a behavioral strategist who says that when the market is grinding higher, people don't want to miss out. He also notes the subdued reaction the market has seen when faced with headline risk, such as developments out of North Korea.
Silverstein sits down with Sarah Hunt, a portfolio manager at Alpine Funds, which oversees $4 billion, and discusseds why she's bullish on energy stocks. Hunt says there's been a change in discussions around oil, and says she expects to see oil demand higher than supply for the first time in years. She notes that this is very helpful from a sentiment standpoint. In terms of energy stock valuations, she says that companies will start to look more attractive once oil prices rise, enhancing cash flows. Hunt also highlights how energy producers have succeeded in cutting costs, and says higher oil prices translate to more sustainable dividends.
Hunt outlines what she sees as the best opportunities in the market, and highlights consumer staple stocks, which have underperformed lately. She likes the dividend yields they offer, and says valuation levels for the sector are getting more attractive. Hunt argues that investors have been ignoring value stocks as they pursue growth, and says that's created opportunity. On a single-stock basis, Hunt mentions JM Smucker's as a company she likes.
--------------------------------------------------
Follow BI Video on Twitter: bit.ly/1oS68Zs
Follow BI on Facebook: bit.ly/1W9Lk0n
Read more: businessinsider.com
--------------------------------------------------
Business Insider is the fastest growing business news site in the US. Our mission: to tell you all you need to know about the big world around you. The BI Video team focuses on technology, strategy and science with an emphasis on unique storytelling and data that appeals to the next generation of leaders – the digital generation.
This week:
Business Insider executive editor Sara Silverstein discusses how the stock market has been turned upside down in September. The stocks that were the best year-to-date performers through August have been the worst in September, while those with the weakest returns over the first eight months have led the way higher. A similar complete reversal can also be seen at the sector level, with market-leading tech and healthcare stocks giving way in this month to energy and telecom. This rotation has helped propel US stocks to new records. It seems that whenever the equity market loses a driver of gains, another is ready to step up and take its place.
Business Insider deputy executive editor Matt Turner speaks to Mike Ryan, the chief investment strategist for UBS Wealth Management Americas, about what keeps him up at night. He says that he's most worried about a policy mistake from central bankers, and that his concern is compounded by the fact that current monetary policy is entirely unprecedented. Ryan notes that central banks around the world have greatly expanded their balance sheet, and highlights the challenge around what happens when they unwind that.
Turner chats with Dennis Ruhl, chief investment officer of JPMorgan's US behavioral finance equity group, about his greatest market fears. Ruhl expresses concern over the unwinding of quantitative easing, as well as political developments that could inject volatility into the market. He says the market headwind that has the greatest likelihood of materializing is the natural aging of the current cycle, as wages and interest rates rise.
Mark Haefele, global chief investment officer of UBS Wealth Management, tells Turner that he's most worried about what happens with interest rates and inflation. He also notes that while many geopolitical developments have a short-term effect before being quickly forgotten, the North Korea situation could be different, and is a threat worth taking seriously.
Turner also addresses recent comments from Fidelity's director of global asset allocation research Lisa Emsbo-Mattingly, who noted that the US market may be overdue for a 5% correction, since we haven't gotten one in about a year and a half. Asked about whether investors have been buying as the stock market has hit new highs, Turner cites a behavioral strategist who says that when the market is grinding higher, people don't want to miss out. He also notes the subdued reaction the market has seen when faced with headline risk, such as developments out of North Korea.
Silverstein sits down with Sarah Hunt, a portfolio manager at Alpine Funds, which oversees $4 billion, and discusseds why she's bullish on energy stocks. Hunt says there's been a change in discussions around oil, and says she expects to see oil demand higher than supply for the first time in years. She notes that this is very helpful from a sentiment standpoint. In terms of energy stock valuations, she says that companies will start to look more attractive once oil prices rise, enhancing cash flows. Hunt also highlights how energy producers have succeeded in cutting costs, and says higher oil prices translate to more sustainable dividends.
Hunt outlines what she sees as the best opportunities in the market, and highlights consumer staple stocks, which have underperformed lately. She likes the dividend yields they offer, and says valuation levels for the sector are getting more attractive. Hunt argues that investors have been ignoring value stocks as they pursue growth, and says that's created opportunity. On a single-stock basis, Hunt mentions JM Smucker's as a company she likes.
--------------------------------------------------
Follow BI Video on Twitter: bit.ly/1oS68Zs
Follow BI on Facebook: bit.ly/1W9Lk0n
Read more: businessinsider.com
--------------------------------------------------
Business Insider is the fastest growing business news site in the US. Our mission: to tell you all you need to know about the big world around you. The BI Video team focuses on technology, strategy and science with an emphasis on unique storytelling and data that appeals to the next generation of leaders – the digital generation.
