A Comment -- General Comments From an Expert (A Commentary)

How are you trading these markets? Not a retail market. It's a trader's market, it goes up and down on rumour. It's all noise right now. There's nothing new happening to these companies. It's just Trump talking the markets up and down.

Outcome of US-China trade wars? Money managers are caught in the middle. That's what makes it a trader's market. Until something materializes, that's all it is. Markets are either toppy or trading lower.

Are you a bull or a bear right now? Short-term, markets have been resilient. But he'd be erring on the sell side. Take wins if you have them, short it, or sell a bit and buy it back if it goes cheaper. Sell half, and then you look smart no matter what happens. The big stocks have been steady and boring.

Could we see another correction like December's? A correction is coming, but it won't be as fast as the one in December. We're slowly going lower in the S&P and the Dow. We've had a market slowly creeping up for the longest time, and it's way past its expiry date.

Gold sentiment. Stuck in a range for so long. Resistance around $1375, support around $1200. Avoid the little ones. Even the big ones have just drifted. We need more than a 1 day or 1 week pop.

Market Outlook - The trade war is weighting on the market. The US is basically holding all the cards. China can't stop importing what is importing. The only thing they could do is sell their US bonds but then they would have a currency problem driving their own currency up making the trade issue worst. India is then next big market to emerge. For now he prefers to play it by investing in large international companies with exposure to those markets.

Market. There are a couple of wars being fought. The super powers of China and the US are fighting a war that is bigger than is going to be solved this year. Now there is a technology war that is happening. It needs to be fought if the US is going to be a power in Technology. The smaller wars probably get solved with band-aids this year. China has their 70th anniversary this year and the US is starting the 2020 election campaign. He sees no recession on the horizon. Investors should be cognoscente of technical levels. The Fed has said they are not hiking this year.

Bitcoin vs. US$. The US$ is backed by a stable government. Bock chain may become a form of payment for younger generations. But Bitcoin is too volatile. It might change value before your transaction settles. There is always a market for something that gives you an alternative. With Bitcoin it is buyer-beware.

Market Outlook The Chinese trade situation is multifaceted. You have worries of spying in Canada and he wonders why our government is so uncertain how to proceed. You have to go back to the 1930s when we saw this type of trade wars.

Retail sales data of late have been weaker than expected. Trade talks is on the mind of investors. The sectors that are more driven by trade have lead the declines. However, corporate earnings are still looking good. 1.4% year over year on earnings growth. Monetary policy should be accommodative for some time. Last few years, growth companies have outperformed value companies and with low interest rates, he expects this to continue.

What's market telling you right now? It's decently positioned. Canadian market hasn't gone up a lot over the last 5 years. So Canada has more upside than the US, because of valuations. In the current decade, energy and materials represent only 25% of the TSX, a decrease. TSX is neglected among the world indices. Valuations are very attractive. Since 2010, S&P has done 3x better than the Canadian side. Financials are the biggest sector, but are still trading at lower valuations than the norm. International investors have turned their backs on Canada in energy. So this is an opportunity.

Navigating the choppy market. Volatily can be your friend. If you like a company that's a chance to buy it. The markets seems unsure about the direction it's going in. Regarding the trade war between China and the U.S, he thinks the U.S. is in a pretty good place since they don't export as much to China as China exports to the U.S., and the U.S. economy is going quite well, they can afford going through this deal. It used to be the Republicans and Trump being against China, but now you got the Democrats saying to put pressure on China.

Market Outlook He thinks we are into the correction part of "sell in May and go away". He is watching long term bond yields, if 10 year yields drop below 2.35% it is a sign that investors are heading for the exits. A break down could take the yield down to 2.00% -- a big boom for bond holders.

Price to book It compares the net worth to the value of the company. A cyclical company may trade below book value. Software companies trade a huge multiples. When compared to ROE, it has some positive influence on share price value.

The Dow was down today, though the US will lift metal tariffs against Canada and Mexico as the China-US trade war continues. He can't keep track. It's worrisome. Talks have stalled. Be patient. The market can't keep going up after Christmas. The trade war won't go on forever. Will interest rates still low? Stock market will stabilize, given low rates. Good earnings in Q1 including from Apple, but there is now the reality of American companies passing tariff costs onto their America customers. Apple's valuation is attractive now. Each year there are 3-5 pullbacks, so pullback like this should be expected, and each one is a buying opportunity.