David Burrows
President & Chief Investment Strategist at Barometer Capital Management
Member since: Jun '01 · 5226 Opinions
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| 4.6 | 224 29.47% | 193 25.39% | 114 15.00% | 117 15.39% | 112 14.74% | ||
| 1 Month | 4.42 | 7 4.12% | 57 33.53% | 67 39.41% | 32 18.82% | 7 4.12% | |
| 6 Months | 4.6 | 31 18.45% | 59 35.12% | 26 15.48% | 37 22.02% | 15 8.93% | |
| 12 Months | 4.7 | 52 32.70% | 44 27.67% | 11 6.92% | 23 14.47% | 29 18.24% | |
| 2 Years | 4.72 | 66 44.59% | 26 17.57% | 6 4.05% | 18 12.16% | 32 21.62% | |
| 5 Years | 4.57 | 68 59.13% | 7 6.09% | 4 3.48% | 7 6.09% | 29 25.22% |
Stock Opinions by David Burrows
Tariffs are one thing, and a big thing. But there's lots going on in the market, and tech has been going through a shift since June of last year. Tariffs have accelerated moves in some sectors. But reality is that whether you're looking at semiconductors, the Mag 7, or growth stocks in general, the market's been rotating. So there are headwinds.
At the end of the day, this giant buildout for AI is a big deal. However, the infrastructure that's been built is going to weigh on tech companies for some time; a lot of depreciation will have to be written off. It's possible that there's been some overbuild.
Don't have FOMO (fear of missing out) right now. There's no indication that tech will return to leadership anytime soon. His firm has 0% in tech right now.
Before you look at individual names, it's really important to understand the type of market we're in. What's happening in tech right now is not healthy. This name held up much longer than most of the index, but every stock in that index is broken. Great company, but don't have FOMO. Sector doesn't have tailwinds right now.
He's a big believer in tracking breadth across the market -- which sectors have the highest percentage of stocks performing well? Where is it improving, where is it weakening? When you get into a tough decline almost everything is impacted, and this decline has been similar to that.
The last group to break down was financials. Within that group, P&C insurance companies were strongest, have not broken down, and have done pretty nicely on the bounce over the last couple of weeks. Wherever you look in the world, financials are the best-performing sector aside from precious metals.
We're in an inflationary environment, likely to have a second wave of inflation especially due to tariffs. Financial services companies benefit from an inflationary environment.
Problem with regional banks is they're probably most closely tied to the US domestic economy. When he looks at market signaling, such as what's happened with crude and other commodity prices, there is a risk we are headed to recession.
Regional banks have a lot of real estate exposure, hold a lot of treasury bonds (and that market has not been very friendly), and it was the first group in the financials to break down technically. RSI weakening since November. Don't be a hero.
He's being very cautious right now. Has about 35-45% cash in portfolios, and that's a lot. Precious metals make up 10-15%. Also 10% global, but ex-North America.
Strangely, global stocks are performing better than US stocks, even though global stocks are the target of tariffs. Part of that is because 31% of the MSCI world index is financials.
Holding cash gives you flexibility. It could be one of those times when we get a quick reversal in the market. But his guess is that a lot has changed in the last month in how we look at the world, and it's going to take some time to sort out.
When breadth is weakening, he stops putting new positions on. But he's always building a farm team of things he'd like to own. Long-term view of this name and copper miners is very favourable. Technical chart's not good. Recently when we had a couple of really bad days, the copper stocks really broke. This is what tells him we may be headed for a recession.
Likes it. Dynamite assets. Cashflow will be good. But he needs to see things get better before putting money to work.
RSI has been steadily improving for aerospace and defense since September 2022. Replacement cycle means lots of business at high margins. Made an RSI new high today relative to the market. Incredibly resilient. Trump's policies will steer other countries to spend more on defense.
