Jan 10, 2013|
Rob Morgan, Fulcrum Securities, on his 2013 expectations
Transcript - Not for consumer use. Robot overlords only. Will not be accurate.
945. Years the financial exchange trucks out of filling in for Barry Armstrong alongside. June night and we are joined now by Robert Morgan from -- securities and rob how are you this morning. Great -- about cell doing pretty well here's -- let's talk a little bit about some of the data that came out this morning first we obviously had the -- weekly unemployment claims. They came out at 8:30 this morning what did you see there anything notable on either side. Well I didn't see anything really noticeable -- I mean it was so little little bit higher than expected 371000. Verses the expectation of 364000. And of course I guess what are your listeners might be able -- -- that maybe maybe that's because stocks to be gallon I think we're still -- restore missed host -- cola. Earnings report. I guess lol if you wanna call it that. -- -- -- -- -- -- -- -- -- -- -- -- -- -- Yeah absolutely and -- -- always gets a lot of the publicity because they do report first but really earning season doesn't kick off it at full steam for another week yourself what companies are you looking for coming up in the next couple weeks that are particularly important to you in terms of maybe Bellwether for where the economy's going. Younger sure. Like -- you you know we we we like the financial sector in general and -- of the big banks. Report pretty early for instance. Wells Fargo. Reports tomorrow so that at a certain yet and -- probably the biggest name that that'll be watching tomorrow but then as far as the as far as the industrials go which is another area. That we like and set out Alcoa was certainly is. Probably gets too too much attention at the because as -- it. Some other companies -- now -- certainly looking at some of that big kid global infrastructure plays like caterpillar and -- international who works name names of those so cried. Now let's take a look at how you're actually going about in investing in this market right now because a lot of folks. We've gotten past the fiscal cliff which had a lot of folks concerned but the problem is. I think a lot of investors are still little gun shy about getting back into stocks heavily and this is even with bonds potentially. Being in line very very rough couple of years so what are you doing right now in order to combat some of the headwinds that might be out there. I think you hit the nail on the head there I I think most individual investors are under invested in stocks the work for the -- -- -- has their gun -- and that that of course is created. Very bad sentiment toward toward stocks which is which is actually cut a perversely I guess a good thing for stock. Gives us the walls were so I I'm recommending that clients that overweight stocks here for for that recent bad sentiment. Now with technical still looking good and and in general earnings. For the for the broad market expanding. And that's it I even -- in my at beginning of the year piece I've I've predicted that the S&P 500 hit a record high yet this year. And and that it does and in. It makes your earnings interpret that yes it is projected to make it'll still be only fourteen times there would still be relatively cheap one. Now are there any places in particular either sectors. Geographic regions anything in particular that you're looking at right now that you find particularly attractive. Like I say kind of starting from a from a macro view. That and and this -- a recent change progress we have we like the small cap area of stocks verses vs a large captors at stake from a macro view that that our most recent change and then digging into the -- a little bit and into the sectors ever mention that we we like industrials and financials but we would they would under way to energy and and -- com. Certainly talked about good reasons for all of those who stand. Am and what sector that we haven't mentioned yet that I know a lot of folks. Do have their eyes on simply because they're not quite sure where it's going to end up this year with obamacare going into effect is the healthcare sector. In general in this is something that we really aren't sure exactly how this is going to affect health care companies what's your stance on the health care sector right well one. And and I guess I guess I'm I'm not really sure either and then and we're neutral were neutral on the space I mean obviously healthcare and general. As has been beaten up -- the last few years so with the stocks are fairly -- so from just a valuation standpoint you can make it takes what maybe you know maybe this is the time to get in -- it but it's hard to say if -- the catalyst is going to be there to move the stocks forward obamacare are certainly. Certainly an issue there's so -- so I would really be right now I think neutral on the on the -- based. We do there're there are certainly companies so that. Look attractive. All right well rob I appreciate you coming out with us this morning and certainly you've given our listeners a lot to think about going into 2013. All right that was rob Morgan from fulcrum securities and June as rob mentioned. A lot of investors right now are a little gun shy about getting into the stock market simply. You know 20082009. Is still very fresh in a lot of folks' minds there's still -- they look at all the discourse that's going on down in Washington. And and that their little skittish about getting into the market so these people it may be left the market you're talking about -- don't wanna come back there is a lot of folks who left the market also you see a lot of folks who may be -- right out of college that they grew up during a time when the market was crashing and they say I don't want any part of that you saw a lot of that. Back in the Great Depression where a lot of kids grown up at that time they saw their parents lose everything they say I'm never going to take that type of risk and they invested perpetually. In CD's and things along that along those lines -- -- people don't like credit cards or debit cards either they only -- -- McCain nationally only spent one day you'll get a lot of folks book born in the twenties they have no credit card debt right -- they paid off their mortgage early simply because they didn't want to have that type. Of issue going full out you don't have it if you don't you know -- at the money that is you know by the issue with that strategy at this point. Okay is particularly if you're in your 50s60s maybe even forties and you're staying heavy in bonds right now. Bonds have the potential over the next couple years to have some very difficult returns simply do the fact. That as folks start to particularly as large institutional investors the ones who were actually moving the market. Start to move more towards equities they are going to you those bond markets and when that happens. What you'll -- is depending on the types of bonds you do have the potential. For some losses in the bond market if you are holding bond funds in particular long term. Broad based bond funds are probably going to be hit very hard in particular if they're holding US treasuries since we've already seen just in the last couple weeks. A fairly substantial move away from US treasuries as yields have started to rise there. So that's something. If you are invested in bonds right now it is it is probably a pretty good time to take a look at your portfolio. Make sure that ideally getting shortened terms of alterations make sure you have some diversification internationally as well as in different types of bonds. And I think in general if you do that you should be able to hold up pretty well that's good advice so. Coming up we are going to be touching briefly. On the ongoing conflict. Between activist investor bill Ackerman and Herbalife this is an absolutely unbelievable story that's going on we'll get to that right after this.