Four market watchers give outlook for July


Stocks dropped again on Friday with just days left in the month. The S&P 500 is on track to close out June down 1%. 

Four experts weigh in on what investors can expect in July.

Ryan Payne, president of Payne Capital Management, says the economic picture might be better than expected in the coming month. 

“I don’t think investors ever learn their lesson, and I think that’s what you’re seeing here too. It’s just if you look at how off the economists have been this whole time, I think at one point, GDP [was seen as] a 50% decline in the second quarter, and I think it’s going to be a bad quarter for GDP, but it’s not going to be that bad. Then you saw that jobs number come in in May which was so much better than anyone expected … I think you’re just going to see more of the same.”

Rick Rieder, global CIO of fixed income at BlackRock, says employment may take longer to recover in some industries. 

“We think of the economy, it’s a compilation of a series of different shapes and … some industries are going to have a very, very different recovery pattern than others and the ones that we talked about are going to be [the ones] we think continue to do well … One of the other things that’s happening is people are realizing — and this is the sad part of it — you can operate with fewer employees, and in a lot of industries, the unemployment rate is going to be stickier to come back because of this dynamic that can operate efficiently that way.”

Bob Diamond, CEO of Atlas Merchant Capital, gives the Federal Reserve high grades. 

“Thus far, I think the grade for the Fed and the Treasury has to have an A in there somewhere, whether it’s an A or an A-minus. I think their actions have been phenomenal. I think they’ve been fast in terms of getting right off the mark. I think they’ve been very, very broad … Over the years, we also have to make judgments based on how this plays out down the road, but right now I think we’re already in an economic recovery. I think it will be jagged.”

David Kelly, chief global strategist at JPMorgan Asset Management, says investors should be in it for the long haul. 

“Stocks are a very long-term asset. This is a book-ended recession. It started with the virus, it’s going to end with a vaccine. It’s a two-year experience. It could be horrible, but thereafter, it’s what do companies do that really matters for the value of stocks … There’s so much uncertainty out there, markets are supposed to hate uncertainty, so I do think there is some danger of a correction in the stock market.”

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