Barron’s Mid-Year Rountable Barron’s 2023 Mid-Year Roundtable / Issue Date: July 17, 2023
There were no changes in the participants from January: Todd Ahlsten, Rupal Bhansali, Scott Black, Abby Joseph Cohen, Sonal Desai, Henry Ellenbogen, Mario Gabelli, David Giroux, William Priest, Meryl Witmer. Responses were phoned in, apparently a week or two earlier.
Re the elusive recession … Most expect one sooner or later. Abby Joseph Cohen doesn’t expect one at all, but concedes a number of factors, including excessively tight monetary policy by the Fed could cause one. Estimates of the onset of recession range from late 2023 to late 2024. Most it seems are predicting one in 2024 and that it will be relatively mild. However, that does not mean stocks will keep rising. Caution seemed to be prevelant among the group.
The Magnificent 7 … Most (if not all) are wary of the big tech names that have carried the markets this year. Some see a sharp sell-off coming in the high flying big tech names. Most don’t expect the major indexes to be significantly higher at year’s end than today. Some expect them to fall. Mario Gabelli thinks that when investors’ buoyant expectations finally clash with continued Fed rate hikes & strident language, the S&P could fall by 10% in the second half. Health care remains a favorite. Everyone suggested some smaller overlooked niche players as opportunities. Genuine Parts (GPC), recommended by Gabelli, fits this theme. He sees it as a play on a “huge pent-up demand for automobiles.” Gabelli also likes aerospace - but leans toward some European manufacturers, including Airbus.
Bonds … Franklin’s Desai favors bonds, but would average in to (longer) maturity as the 10-year rises above 4%. Sees it getting to around 4.25%. She also favors high yield - particularly municipal high yield bonds. It should be noted Desai is a fixed income manager at Franklin and often favors the bond sector. She often recommends Franklin’s income funds along with others.
Europe … One member referenced the stubborn inflation in the U.K. as “the canary in the coal mine” that could signal similar issues arising at home and globally and lead to even tighter monetary policy. Yet, generally, the tone on European equities was quite positive. While some individual Japanese stocks were mentioned, I don’t recall anyone being outright bullish on Japan. Its stock market has enjoyed a significant boom over the past year or two.
Geopolitical peril is highlighted by Priest: The war in Ukraine, U.S. China tensions, political strife at home, likelihood of higher rates in Europe. Not calling for recession, but Priest expects the S&P to fall in the second half, while equal weighted indexes might hold their own or rise slightly. Scott Black comments that “investors are much too bullish.” But his remarks appear largely based on S&P valuations. Anyalists, Black says, are projecting S&P earnings growth above 10% for the year - totally unrealistic in his view. Bhansali is arguably the most bearish of the lot. Even he sees “opportunity” in value stocks - but mostly abroad, including EM. Referring to Fed rate hikes and inflation Bhansali says: “The Fed has a lot of wood left to chop.”
David Giroux (T. Rowe Price) commented: “The market was helped by the lack of a recession, resilient earnings, and excitement about AI, which turned the tide in terms of investor sentiment and valuations in the technology sector. The challenge now is that the market is trading for 19 times forward earnings, and valuations aren't as attractive as they were. Now that everyone seems bullish, we are a bit more bearish. You'll see that in our stock recommendations. Cyclicals and tech have had a big run. Now we prefer more-defensive sectors, such as healthcare and utilities.” Others echoed Giroux’s caution, if not his exact words.
A “non-political” political remark by Giroux may raise a few eyebrows: “And, while I am not making political projections, if the Republicans take back the White House in 2025, UNH and managed care stocks generally could have significant upside.”
Top picks:
Ahlsten: ORCL - Oracle
Bhansali: ITUB - Itau Unibanco Holding
Black: EXP: Eagle Materials
Cohen: iShares S&PU.S. - Banks
Desai: 5-YR TIPS
Ellenbogen: JBHT - J.B. Hunt Transport Services
Gabelli: BATRA - Liberty Braves Group
Giroux: BIIB - Biogen
Priest: Air.France - Airbus
Witmer: ONEX - Onex, Canada
Charles Schwab announces TD Ameritrade data breach My TD migration date is many months away. TD said if I want to move sooner, I have to go through the account transfer portal (ACAT) and that it could take up to one week.
I setup a Schwab account and moved 95% of my stuff over back in summer 2020 and it went rather smoothly ... I didn't want to go thru *another* brokerage account mass migration. I need to check if my $
15 OEF fee conveyed, but if it didn't, when they finally get around to moving my TD account, I will be sure to confirm the $
15 OEF fee is included. (Thx for the reminder)
Charles Schwab announces TD Ameritrade data breach Wow, they're really dragging out the process in some cases, but it's probably better they go slowly to smooth out the bumps. My transition, as I said, went seamlessly over a weekend.
They DID suggest that you set up Schwab account/login prior; that way there will be no issue with your login. Had the advantage of allowing me the 'new account' bonus! And, grandfathered the TOS $15 purchase fee in lieu of their $49.95 fee. So far, no problems, but I DID change my password just now...
Yogi Bear Bull Is ill. YBB is one of the good guys. His weekly synopsis of Barron’s is greatly appreciated. Hope you get well soon.
+
1.
Charles Schwab announces TD Ameritrade data breach I don’t think think or swim is available in Schwab yet. They said “soon” last time I asked.
My TD/Schwab guy, plus the 'rumor mill' says Q3 or Q4 this year, but I'll believe it when I see it. Right now I use my TD account for ToS charting/data even though I only have like $
1000 in the account to keep it open -- everything else I had at TD is at Schwab.
Need a solid, good, consistent, un-flashy AA fund. (Closed thread.) @fundly,
A lot of brokerages charge a transaction fees (e.g., $50) for purchase of mutual fund institutional class shares but they do not charge a short term redemption fees (the fund itself may have its own STR fees). Am I correct that Firstrade does not have a transaction fees but has a STR fees of $
19.95 for Institutional class shares held for less than 90 days?
From Firstrade website - "A Short Term Redemption Fee of $
19.95 will be applied to redemptions of mutual fund shares held less than 90 days. Broker-Assisted redemptions will incur a charge of $
19.95. Redemptions of less than $500 will incur a $
19.95 fee, unless the entire value of that fund is less than $500. For mutual funds transferred to Firstrade, the 90 day holding period will begin when the account transfer process is complete."
Thanks.
FD1000...3-Line Break Maybe the two belligerents need to take a long walk to cool off.
FD1000...3-Line Break @FD1000 I have been reading that you are a proponent of 3-line break. What is it telling you today regarding ORNAX and NHMAX? Please don't come back in three weeks and tell us what it told you on 7-
14-23.
mmm...so you want to learn but over the years you weren't so nice.
Racq wants to learn too, and he has been very nice to you.
No problem, Racq can contact me and I will be glad to explain it. You trashed me before too.
No more posts from me on this thread.
Like I said, perhaps this time in more colorful terms, if you're asking FD to publicly state something prospectively about the markets or his secret sauce strategies and/or holdings, settle into your favorite armchair and pound salt.
It just simply ain't gonna happen. EVER!
Because that alone would blow his cover.
Nice try though
@mona!
Wow, you make a fool of yourself. I posted about it many times on other sites with examples.
Is this the same stillers that kept posting for years the following: FD lies all the time, FD will never retire, if he would retire he would never make it...and so many other false statements. Well, I retired in 20
18 and my portfolio grew so much more, including all the expenses.
