A smartphone slump?While President Trump says the U.S. is “locked and loaded” and investors sift through the aftermath of the weekend attack that disrupted Saudi Arabia’s crude output, the Wall Street vet who ran Merrill Lynch’s giant tech fund during the dot-com days issued a warning for those looking to hitch their ride to the tech sector.
A near-term correction is “inevitable,” warns Paul Meeks, portfolio manager at Independent Solutions Wealth Management, in our call of the day.
We’re already seeing red ink spilled all over the premarket, but Meeks’s forecast focuses on the lingering uncertainty of the trade war.
“My typical tech company is deeply embedded in a supply chain between the two nations,” he told CNBC. “We’ve also started to see a decline in the economic growth rate particularly abroad, less drastic here in the states. But a lot of people don’t realize that tech products and services, whether that be sold to the enterprise or sold to the consumer, you know typically are cyclical.”
Hence, Meeks is calling for a near-term drop on the tech-heavy Nasdaq Composite of 10%, which he says should give investors a chance to sniff out some deals. “I always have my eye on my favorite tech names, and I look for opportunities to buy them on dips,” he explained.
But those deals don’t include tech juggernaut Apple, as he believes a secular slump in smartphones will weigh heavily.
“I would like to shift out of those names in this kind of environment and try to find some deals in software,” he said. “The one that I like the most particularly as I exit Apple and increase in the software space is Salesforce.com.”
Meeks says Salesforce.com’s software business “is growing faster and is much more profitable than anything that Apple is doing.”
The chart
No brainer pick for the chart of the day: Crude prices went vertical at the open: Here’s what a double-digit jump looks like in the oil pits:
The market
As oil goes nuts, sellers are flocking to safer assets. The Dow DJIA, -0.03%, S&P SPX, +0.00% and Nasdaq COMP, +0.11% are all down midmorning. Gold is capitalizing on the uncertainty with a move higher and the Japanese yen is also catching a bid.
Europe stocks aren’t doing much better, while Asia markets ended with losses. The dollar is heading lower.
The tweet
Lindsey Graham
✔@LindseyGrahamSC
·
Iranian supported Houthi rebels who attacked Saudi oil refineries is yet another example of how Iran is wreaking havoc in the Middle East. The Iranian regime is not interested in peace – they’re pursuing nuclear weapons and regional dominance. https://www.foxnews.com/world/drone-attack-saudi-oil-facility-iran-rebels …
Drone strikes target world’s largest oil processing facility, Saudi oil field; attack claimed by…
The world’s largest oil processing facility and a nearby oil field in Saudi Arabia were set ablaze early Saturday morning after reported drone attacks by Iranian-backed Yemeni rebels.
foxnews.com
Lindsey Graham
✔@LindseyGrahamSC
It is now time for the U.S. to put on the table an attack on Iranian oil refineries if they continue their provocations or increase nuclear enrichment.
The UAW announced on Sunday that more than 49,000 workers at General Motors plants in the U.S. would go on strike just before midnight because contentious talks on a new contract had broken down.
Purdue Pharma, the U.S. company that made billions selling the prescription painkiller OxyContin, has filed for bankruptcy.
China delivered a batch of disappointing data, including industrial output and retail sales. China’s premier Li Keqiang reportedly said it would be ‘very difficult’ for the economy to keep 6% growth going.
New York Gov. Andrew Cuomo is pushing to enact a statewide ban on the sale of flavored e-cigarettes amid growing health concerns connected to vaping, especially among young people.
The quote
“I sat through those hearings. Brett Kavanaugh lied to the U.S. Senate and most importantly to the American people. He was put on the Court through a sham process and his place on the Court is an insult to the pursuit of truth and justice” — That was Sen. Kamala Harris and Democratic presidential candidate, tweeting about the latest allegations facing the Supreme Court justice.
Even as President Trump rushed to his defense, others, like Bernie Sanders, joined Harris in calling for action:
Supreme Court justices are not above the law. Someone who sits in judgment over the nation should have the highest integrity.
Bernie Sanders
✔@BernieSanders
The revelations today confirm what we already knew: During his hearing, Kavanaugh faced credible accusations and likely lied to Congress. I support any appropriate constitutional mechanism to hold him accountable.
August housing starts and existing home sales data will be highlights this week, but we won’t get a look at those numbers until Wednesday and Thursday, respectively. We’ll also hear from the Fed, which is expected to cut rates by 25 basis points midweek. As for today’s schedule, which is on the light side, the New York Fed Empire State manufacturing survey is released at 8:30 a.m. Eastern.
The stat
$823,000 — That’s how much the Trump campaign netted by selling plastic straws to score political points, according to the New York Times. The campaign also managed to convince supporters to pony up another $50,000 for Sharpie pens.
Tech stocks face a 10% drop in the near-term, warns investor who once ran the world’s biggest technology fund2019-10-072019-10-07https://kemptonasset.com/wp-content/uploads/2018/01/kemptonlogotipo.pngKemptonhttps://kemptonasset.com/wp-content/uploads/2019/10/tech-markets.jpg200px200px
Warner Bros/Everett
