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Market. There is always some kind of drama. This week it feels like something has changed but he sees it playing out in a normal fashion. There has been a bit of slowing economic data and the ISM Service Non-manicuring data has not moved into contractionary territory but is showing signs of slowing. The cracks in the services side of the economy in the US are a sign that what is happening in the rest of the world does affect the US. There is political impact from the trade drama. Trump is in a weaker negotiating position with the Chinese and this will cause a more protracted trade war with China which will be bad for growth. He is a little more conservative with equities. He is gearing his portfolios for slower growth and lower yields. If you get a moderate pull back in the economy, zero growth or negative growth but not a deep contraction you do get a decoupling and differentiation and you can stock pick better. You might consider REITs as they do better in that environment. He is more into bonds than equities at present.
DON'T BUY
He is hesitant to engage in themes that get politicized. Drug pricing can get highly politicized at various points in time. He just avoids it. He backs away. It is a long way to the election. Your risk is way more than your reward. Management is exceptional in this company but it is not worth stepping into this when you cannot handicap the political risk.
medical services
DON'T BUY
These guys all tend to move as a group. They have had a bit of a run. There is volatility from when games are released and that is how the business model works. With how things are changing it is really risky to try to call things in a three month timeframe. It's a wild ride. This is the strongest season of the year, however. He would avoid it on the volatility. He might take profits on this if he had it.
computer software
processing
DON'T BUY
UPS-N had some interesting news with the FFA approval of their drone delivery business. FDX-N is a few PE multiple points cheaper. UPS has had a positive trend change. FDX has been pulling back again. He prefers UPS if you had to. But neither one is really doing well. Global growth is the most important indicator for both companies and it is not favourable.
Transportation
DON'T BUY
UPS-N had some interesting news with the FFA approval of their drone delivery business. FDX-N is a few PE multiple points cheaper. UPS has had a positive trend change. FDX has been pulling back again. He prefers UPS if you had to. But neither one is really doing well. Global growth is the most important indicator for both companies and it is not favourable.
Transportation
HOLD
There are interesting trends that are positive. People when things are tighter shift from full time to temporary. This company fills the holes. There can be a structural shift as things slow down and hospital administrations are looking for cost cuts. There can be a bit of a tailwind. This is not a bad time. It is isolated from the trade war which is a good thing. They don't have a dividend. Be careful because when it gives up on you, you have to step out. Have a trailing stop in place.
Healthcare
WAIT
They tend to have more of a sustainable energy tilt. He wonders if everything at the UN recently has caused a real lift. It got attention. They have also done really well recently. They have a couple of percent yield. It has been a nice consistent performer. There is nothing not to love. You might want to wait until after earnings.
electrical utilities
